Dentsply Sirona announces resignation of 3 senior executives, names new interim CEO
Above: New Dentsply Sirona CEO Mark Thierer
LAST MONDAY, Dentsply Sirona issued a statement announcing a shakeup of its senior leadership. The company's board of directors accepted resignations of Bret Wise, executive chairman; Jeffrey Slovin, CEO and director; and Christopher Clark, president and COO. Mark Thierer was named interim CEO, and Bob Size was named interim president and COO. In addition, Eric Brandt was elected as nonexecutive chairman of the board. The company statement added that it has begun searching for a permanent CEO and COO. (1)
“Dentsply Sirona’s Board of directors strongly believes that the company is well-positioned to achieve its business objectives and deliver value for its shareholders, and that new leadership is critical to achieving success,” said Brandt in the company statement.
The Wall Street Journal reported that a regulatory filing subsequent to the announcement did not disclose reasons for the resignations. However, an unnamed source said the shakeup occurred because the company was lagging behind expected earnings. (2) Earnings per share were at $0.47 as of October 6, 2017.
After the announcement was made, the company's stock fell 6.95% on the NASDAQ, with shares moving from $59.81 to $55.65. However, by week's end the stock had climbed to $58.51.
In February 2016, Dentsply and Sirona became the world's largest manufacturer of dental products and technologies after a $14.5 billion merger. In August, the company the drew the attention the US Securities and Exchange Commission (SEC), which filed a request for accounting information and disclosures regarding a major distributor. After last week's resignations, there was speculation that the action was related to the SEC request. However, The Wall Street Journal reported otherwise. An unnamed source said the shakeup was unrelated to the SEC filing, and that regulatory dealings were proceeding favorably. (2)
An SEC filing by Dentsply Sirona noted that Thierer's six-month interim pay package totals $6.5 million, which includes a base salary of $1.5 million, a signing bonus of $2.5 million, and stock valued at $2.5 million. Size is to be paid a base salary of $709,650 on an annualized basis, along with a cash bonus and an estimated $1.9 million in stock and options. (3)
Thierer has more than 30 years' experience in health care, most recently serving as CEO of OptumRx, the pharmacy benefit arm of UnitedHealth Group. Prior to this, Thierer served as chairman of the board and CEO of Catamaran, a pharmacy benefit company. Catamaran merged with OptumRx in 2015.
Size previously served as senior VP of Dentsply Sirona. In this role, he had operating responsibilities over manufacturing operations and selling organizations located in the United States and Europe, as well as the Dentsply North America Sales organization. Size has also served as a VP in the company's Dentsply Caulk division.
In an email to subscribers, the capital management firm Robert W. Baird & Co. Inc. stated, "While a lot to digest, our initial reaction is this move is a housecleaning meant to jump-start integration efforts that have been slow to develop, which we consider an overall positive for the company." (4)
References
1. Dentsply Sirona announces leadership changes. Dentsply Sirona website. https://news.dentsplysirona.com/en/corporate-news/2017/dentsply-sirona-announces-leadership-changes.html. Published October 2, 2017. Accessed October 8, 2017.
2. Lubin J. Behind unusual ouster of company’s top three leaders: A troubled $14.5 billion merger. The Wall Street Journal website. https://www.wsj.com/articles/dentsply-sirona-executive-shakeup-follows-soured-merger-1507047873. Published October 3, 2017. Accessed October 8, 2017.
3. US Securities and Exchange Commission Form 8-K filing by Dentsply Sirona Inc. https://www.sec.gov/Archives/edgar/data/818479/000134100417000613/form8k.htm. Filed October 2, 2017. Accessed October 9, 2017.
4. Baird/XRAY/Johnson: Announces major shakeup at the top. Robert W. Baird & Co. Inc. enewsletter correspondence. October 2, 2017.
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Editor's note: This article first appeared in the Apex360 e-newsletter. Apex360 is a DentistryIQ partner publication for dental practitioners and members of the dental industry. Its goal is to provide timely dental information and present it in meaningful context, empowering those in the dental space to make better business decisions. Subscribe to the Apex360 e-newsletter here.
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