T-Mobile CEO John Legere, perhaps as well known for hosting Twitter barbecues as securing what could be its biggest purchase to date -- Sprint -- said he will step down from that role at the end of April, upon which he will be replaced by chief operating officer Mike Sievert.
Legere, who’s long hair and penchant for magenta T-shirts emblazoned with the company logo was a refreshing departure from the staid, buttoned-down norm for telecom executives, said his departure would have no effect on the pending merger with Sprint. The deal, which received Federal Communications Commission approval on Nov. 5, currently is negotiating with several states’ Attorneys General who had previously moved to block the deal. The companies have said in the past they would not complete the transaction before those cases were settled.
“This succession news changing nothing in our plan to merge with Sprint,” Legere said on a conference call with analysts Monday. “We are not done yet, not by a long shot.”
Speculation had been high that Legere was being considered to run troubled real estate startup WeWork, rumors which Legere quashed during the conference call.
“I was never having discussions to run WeWork,” Legere said on the call, adding that his inability to comment because the succession announcement was in the works made it “an awkward couple of weeks.”
Legere was a bit coy about his plans for the future -- he said his top priorities are settling and/or winning in court the remaining AG suits, finding an appropriate Christmas gift for Sievert, and help setting up the integration of the new T-Mobile and the transition to Sievert’s leadership.
“Sometime come around May, we’ll take a look at that,” Legere said.
T-Mobile stock was down slightly in early trading Monday, priced at $77.94 each at 12:12 p.m., down 13 cents per share. Sprint stock was priced at $5.84 each at 12:12 p.m. Monday, up 1 cent per share.
Analysts were relatively unsurprised about Legere’s departure -- one said the company has been hinting about it for months.
"Part of the reason we feel less surprised, is because T-Mobile has been gently suggesting that Legere was not in it for the long haul,” Sanford Bernstein analyst Peter Supino wrote in a note to clients. “In fact, had the merger closed under a reasonable timeframe, we would be 1 year into the New T-Mobile by May 2020. We also note that recent operating results have been excellent despite the merger's drag on senior management's time. The evidence suggests that this company has its act together."
The analyst added that the combined company won’t necessarily shed Legere’s irreverent management style with a new chief.
Our initial take is that this will be as undisruptive as a CEO transition will be,” Supino wrote. “No doubt that T-Mobile loses Legere's noisy marketing style (though Sievert was previously CMO so there is less risk there than one may think), but the company gains a strong strategist who has been a big part of T-Mobile's recent success. We think T-Mobile is well past the point of needing a big personality to gain attention, as its consumer "premium value" proposition is now entrenched.”