Sun Life’s Connor to Replace CEO Stewart When He Retires

July 04, 2011, 4:38 PM EDT By Kevin Bell and Sean B. Pasternak

(Updates with closing shares.)

July 4 (Bloomberg) -- Sun Life Financial Inc. said Chief Executive Officer Donald Stewart will retire on Nov. 30 after 13 years leading Canada’s third-biggest insurer.

Sun Life named Chief Operating Officer Dean Connor as his successor, taking up the role effective Dec. 1, the Toronto- based company said today in a release.

Stewart, 64, began his career at Sun Life’s London office in 1969. He left the insurer in 1974 to pursue a career in benefits consulting, and then returned in 1980. Born in Scotland, Stewart oversaw Sun Life’s demutualization that was completed in March 2000 and expanded the company’s operations in Canada, the U.S. and Asia.

Sun Life shares have more than doubled since they began trading at C$14 a share on the Toronto Stock Exchange in March 2000. Shares of Manulife Financial Corp., the country’s largest insurer, have risen about 63 percent over that same period.

Connor, 54, joined Sun Life in 2006 from Mercer Human Resource Consulting, and has since held several leadership positions at the insurer. He will work closely with Stewart until his retirement, the company said.

“Every leader brings something different in style and approach,” Connor said today in a telephone interview. “People will see a difference -- and similarities -- and those will appear over time.”

MFS Management

Sun Life will continue to focus on operations in North America and Asia, as well as asset-management businesses such as Boston-based MFS Investment Management, which created the first U.S. mutual fund in the 1920s.

“We see great opportunities for Sun Life to grow that part of the business,” said Connor, who holds an Honours in Business Administration from the Richard Ivey School of Business at the University of Western Ontario.

James Sutcliffe, a director of Sun Life, will become chairman on Dec. 1, replacing Ronald Osborne, who is also retiring after six years as chairman.

Sun Life rose 18 cents to C$29.23 at 4 p.m. in trading on the Toronto Stock Exchange.

To contact the reporters on this story: Kevin Bell at Kbell2@bloomberg.net; Sean B. Pasternak at spasternak@bloomberg.net

To contact the editor responsible for this story: David Scanlan at dscanlan@bloomberg.net

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Greenlight’s Einhorn Says Microsoft Should Replace Ballmer

May 26, 2011, 10:02 AM EDT By Dina Bass, Kelly Bit and Saijel Kishan

(Updates with opening shares in eighth paragraph.)

May 26 (Bloomberg) -- Greenlight Capital Inc. President David Einhorn called for Microsoft Corp.’s board to replace Chief Executive Officer Steve Ballmer, saying the software maker suffers from “Charlie Brown management.”

Ballmer is weighing on the company’s share price, Einhorn said yesterday at the Ira Sohn Investment Conference in New York. Even so, he recommended Microsoft shares because the stock trades at a “remarkable discount” to the Standard & Poor’s 500 Index while the business outperforms the average S&P company. Microsoft is Greenlight’s eighth-biggest U.S. stock holding.

“It’s time for Microsoft’s board to tell Steve Ballmer, ‘All right, we see what you can do, let’s give so-and-so a chance,’” Einhorn said. “His continued presence is the biggest overhang on Microsoft’s stock.”

Ballmer, 55, has come under increased scrutiny from shareholders as the company loses market share to Apple Inc. and Google Inc. in mobile phones and Apple’s iPad takes sales from personal computers running Microsoft’s Windows. Last year, the board docked Ballmer some of his potential bonus for falling short in the mobile industry and new forms of computers.

Greenlight, a New York-based hedge fund, added 1.39 million Microsoft shares last quarter, for a total of 9.07 million, according to a filing. The stake is worth $230.2 million. Microsoft’s shares have underperformed the S&P 500 in four of the past five quarters.

Frank Shaw, a spokesman for Redmond, Washington-based Microsoft, declined to comment.

Top Shareholder

Ballmer is the company’s second-biggest shareholder -- with more than 333 million shares, or almost 4 percent. Co-founder and Chairman Bill Gates owns more than 561 million shares, or a 6.7 percent stake, according to Bloomberg data.

Microsoft climbed 30 cents, or 1.2 percent, to $24.49 at 9:37 a.m. New York time in Nasdaq Stock Market trading. The shares declined 13 percent this year before today.

Einhorn, best known for profiting from bets against Lehman Brothers Holdings Inc. four months before the firm collapsed in 2008, is a frequent speaker at the annual Ira Sohn conference. In 2006, he used his speech to discuss his recent purchase of Microsoft shares and to recommend the stock.

Since then, earnings per share have more than doubled and four of Microsoft’s product segments have shown improvement, Einhorn said. The company has also almost doubled its dividend and is now trading at a far bigger discount to the S&P 500, he said.

‘Not Getting Credit’

“Microsoft trades at a remarkable discount,” Einhorn said. “Microsoft is not getting credit for its achievements and prospects.”

Microsoft shares trade for about 9.8 times profit from the past year, or 34 percent less than the price-earnings ratio for the S&P 500. That’s the biggest discount since at least 1992 for the company, according to data compiled by Bloomberg.

Still, Ballmer isn’t taking advantage of Microsoft’s opportunities, Einhorn said. In his criticism, he likened Ballmer to Charlie Brown, a perpetual loser in baseball, football and other pursuits. The cartoon character’s signature lament is, “Good grief!”

“Ballmer’s problem is that he’s stuck in the past,” Einhorn said. “He’s allowed competitors to beat Microsoft in huge areas, including search, mobile-communications software, tablet computing and social networking. Even worse, his response to these failures has been to pour tremendous resources into efforts to develop his way out of these holes.”

Internet Losses

Microsoft’s online services business, which includes the Bing search engine, lost more than $700 million last quarter.

Einhorn, whose hedge fund manages $7.8 billion, criticized Lehman’s accounting during a speech at the same conference in 2008. Four months later, Lehman filed for the largest bankruptcy in U.S. history.

Einhorn said Lehman hadn’t disclosed its holdings of collateralized debt obligations properly and wasn’t valuing its commercial mortgage-related assets based on market prices.

His wagers haven’t always paid off. Einhorn said at the Ira Sohn conference last year that he continues to bet against rating agencies Moody’s Corp. and McGraw-Hill Cos., owner of Standard & Poor’s. Moody’s has risen 79 percent in the past year, while shares of McGraw-Hill have climbed 51 percent.

Back in 2006, Einhorn compared his investment approach to the strategy he uses in fantasy baseball, a game won by assembling the best team of Major League Baseball players. Einhorn said he’s usually reluctant to spend more than $30 on individual players because he only has $260 to buy the whole roster. Still, he said if Alex Rodriguez, then the sport’s most valuable player, were available for $35, he’d pony up.

Microsoft, he said at the time, was similar -- a little higher valuation than the companies he usually buys, but “Microsoft is A-Rod.”

--with assistance from Josh Fineman and Nick Baker in New York. Editors: Nick Turner, Tom Giles

To contact the reporters on this story: Dina Bass in Seattle at dbass2@bloomberg.net; Kelly Bit in New York at kbit@bloomberg.net; Saijel Kishan in New York at skishan@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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