Nortel CEO Mike Zafirovski steps down
Posted August 10, 2009 9:34 a.m. EDT
Updated August 10, 2009 10:57 a.m. EDT
Research Triangle Park, N.C. — Mike Zafirovski is out as chief executive officer at Nortel, and four-time N.C. Gov. Jim Hunt is no longer on the board of directors at the bankrupt communications gear maker.
Zafirovski left his position Monday as part of a management shakeup at Nortel. The Canadian-based company, which employs some 1,800 people in the Triangle, has been in bankruptcy since January.
Zafirovski also lost his seat on the board.
Nortel slashed its board to three people from nine, replacing board chairman Harry Pearce. According to Canadian media, Pearce played a key role in recruiting Zafirovski away from Motorola in 2005 in an attempt to turn around a company that had been in financial difficulty for years.
Zafirovski also left just two days after an interview with the Ottawa Citizen in which he said he planned to leave the company.
David Robinson, a member of the board, took over as the new chairman.
Nortel’s board members chose to resign, according to the Toronto Globe and Mail.
According to BusinessWeek, Hunt has been a member of the Nortel board since 2005, serving as an independent director, chairman of the nominating and governance committee and a member of the audit committee.
Zafirovski tried to transform the troubled telecommunications company but said the economic crisis changed the outlook dramatically. Nortel became the first major technology company to seek bankruptcy protection in this global downturn.
Zafirovski presided over a disheartening series of work force cuts and restructurings, and most recently the selling off of assets.
Pearce said in a statement Monday that Zafirovski made progress on getting the company past its prior accounting scandals and legal issues.
He said it was unfortunate the transformation was derailed by a deteriorating economic climate and the company's legacy cost structure.
"We've reached a logical departure point," Pearce said in a statement. "Mike made a commitment to see the process through the stabilization of the company, sale of its largest assets and the right plans and people to continue operating our business and serving customers. He has done so. I appreciate the commitment and passion he brought to this company since day one, including his guidance through the extremely difficult decisions we faced since filing for creditor protection."
(The Associated Press also contributed to this report.)