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Hertz global replaces CEO after earnings misses, stock slump
[SOUTHFIELD, Michigan] Hertz Global Holdings Inc named Kathryn Marinello as chief executive officer to replace John Tague, the former airline executive who joined the company two years ago after an accounting scandal.
The rental-car company has often missed analysts' earnings estimates despite industry consolidation that had seemed to position it for profitable growth. Shares in the largest publicly held US rental-car company slumped 60 per cent this year through Monday before jumping 11 per cent on Tuesday amid speculation on Twitter that Carl Icahn, the largest shareholder, would take Hertz private.
Mr Tague will retire Jan 2 and Ms Marinello will take over the following day, Hertz said in a statement Tuesday. The company also said its three longest-serving directors have chosen to leave the board: nonexecutive chairman Linda Fayne Levinson, Carl Berquist and Michael Durham will depart Jan 2. Henry Keizer was elected to replace Fayne Levinson as nonexecutive chairman.
"I am excited about Hertz and its prospects with Kathy at the helm," Mr Icahn said in the statement. "Kathy has a history as a proven CEO and I believe she is the right person to lead Hertz as we move forward. Her consistent track record of successes in consumer and financial services, as well as technology businesses, is impressive. She was extremely well-regarded at GE and successfully turned around Ceridian and Stream."
Mr Tague took over in 2014 after former CEO Mark Frissora stepped down in the wake of accounting problems at the company and shortly after Mr Icahn showed up with a large stake. Mr Tague was chosen over rental industry veteran Scott Thompson, who ran Dollar Thrifty before it was bought by Hertz. Several years of financial reports were restated.