Following in Ford's footsteps, Chrysler will name an automotive outsider to replace Chairman Bob Nardelli. C. Robert Kidder was former chief at Borden Chemicals and Duracell International.
Troubled Chrysler is set to become the latest Detroit maker to reach outside traditional automotive circles for its next senior executive. With Chairman Bob Nardelli set to step down, if or more likely when Chrysler emerges Chapter 11 bankruptcy protection next month, the carmaker plans to appoint C. Robert Kidder to replace him.
Kidder, the former head of Borden Chemical and Duracell International, will take on a streamlined operation that will have the U.S. government, the United Autoworkers Union and Fiat SpA as its largest shareholders. But the structure proposed for Chrysler, post-bankruptcy, would give the controlling hand to Fiat, which will start with a 20% stake and, if all goes according to plan, rise to 35%, and then controlling interest longer-term.
“With his broad expertise serving on numerous world-class boards and his accomplished business background, Bob will provide the leadership and strategic counsel that will help to create a strong global competitor moving forward,” Nardelli said about his successor, in a prepared release.
Capping his four-decade career, Kidder currently serves as, among other things, lead director for the financial services company Morgan Stanley.
“I am confident that Chrysler will emerge from Chapter 11 a lean and powerful competitor, combining its own rich history of innovation with Fiat’s technology and expertise to invigorate the American car market and to challenge other car companies around the globe,” said Kidder.
Kidder also serves on the boards of Schering-Plough Corporation, and Microvi Biotech Inc. He previously was a director of such companies as Electronic Data Systems Corporation and General Signal Corporation. During his tenure with McKinsey and Company Inc., Bob worked with an unnamed major OEM client (Ford) in the automotive industry. Bob currently is Chairman and CEO of 3Stone Advisors LLC, an investment firm that focuses on clean-tech companies.
Kidder holds an M.S., Industrial Economics from Iowa State University and a B.S., Industrial Engineering from the University of Michigan. He resides with his family in Columbus, Ohio.
“We are most fortunate that Bob Kidder will lead the new company through its transformation,” said Nardelli. “My number one priority has been to preserve Chrysler and the livelihoods of thousands of people who depend on its success.
Chrysler LLC announced on April 30, 2009, that, as a result of the comprehensive restructuring plan agreed to by many of its stakeholders, it had reached an agreement in principle to establish a global strategic alliance with Fiat to form a new company.
On the same day, Chrysler LLC and 24 of its wholly-owned U.S. subsidiaries also filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code in U.S. Bankruptcy Court for the Southern District of New York. Chrysler also filed a motion under Section 363 of the Bankruptcy Code requesting the swift approval by the Court of the agreement with Fiat and the sale of Chrysler’s principal assets to the new company. The court has been moving swiftly, since then, much to the consternation of dissident creditors.
The benefit of this type of filing is speed, according to senior administration officials who briefed TDB. It will allow a leaner new company to emerge in less than 60 days from the time of filing, well positioned for long-term viability. Creditors are contesting the speed, and an objection is currently waiting for the judge’s ruling, although he has already over-ruled similar objections. The momentum provided by U.S. Treasury support and the logic of preserving assets to give the new company a chance for survival appear to argue for a quick reorganization.
Nardelli, Chrysler’s Chairman and CEO since August 2007, announced on April 30 his plan to leave the company following the completion of the transactions. He will return to Cerberus Capital Management LP as an advisor. He said that it was “an appropriate time to let others take the lead in the transformation of Chrysler with Fiat, and I will work closely with all of our stakeholders to see that this new company swiftly emerges with a successful closing of the alliance.”
As stated in the terms of agreement, upon successful completion of the alliance, a board of directors for the new company will be appointed. The majority of the directors will be independent (not employees of Chrysler or Fiat). The board will select a CEO with Fiat’s concurrence.
Paul Eisenstein and Ken Zino reported on this story.