The billionaire former U.S. presidential candidate and founder of Perot Systems hands the reins of his company to son Ross Perot Jr.
Effective immediately, Ross Perot Jr., 41, will assume the role of chief executive officer of Perot Systems, the Dallas-based company said in a statement released late yesterday. Ross Perot Sr. will continue as chairman of the computer services company, working closely with customers and the sales and marketing teams.
Financial analyst Michael Hutchison of Barrington Research Associates said the news comes at a good time for the company, which has seen business improve and garnered strong project bookings in its most recent quarter.
"(Perot) has built a company, to date, with over a billion dollars in sales," said Hutchison. "He built this company with essentially no acquisitions and advertising...They've got a good e-commerce initiative going on at this point to complement their core business. They're in a good position. He's coming out at a good time."
Hutchison, who recently upgraded the stock to a long-term "buy" rating, said he expects the company to see improved sales in the near term despite the recent loss of some large client contracts.
The elder Perot twice ran unsuccessfully for U.S. president as a third-party candidate, representing the Reform Party, which he founded. Perot ran for president in 1992 as an independent favoring campaign reform and fiscal discipline. He drew 19 percent of the vote, which was widely viewed as helping Bill Clinton defeat incumbent George Bush.
Perot, 70, a graduate of the U.S. Naval Academy, also founded computer services giant Electronic Data Systems in 1962 and helped grow that company into a multibillion-dollar business. EDS competes head-to-head against some of the top-tier giants in the services and consulting industry, such as IBM Global Services, Andersen Consulting and Computer Sciences.
The elder Perot sold his interest in EDS to General Motors for more than $700 million and founded Perot Systems in 1988. The auto giant is also EDS' largest customer. Last year, Perot Systems reported $1.15 billion in revenues.
Like other old-line services companies, Perot Systems has been busy scrambling to find its place in the new Net economy, as companies race to move their businesses to the Web. While the company continued to sign traditional outsourcing deals over the past year with big-name companies such as Nortel Networks and Harvard Pilgrim Health Care, it also faced heightened competition from smaller Internet consulting firms that help clients with Web development, strategy and design.
The younger Perot, who most recently worked overseas expanding the company's Europe and Asia businesses, will remain chairman of Hillwood Development, a privately held real estate company he founded in 1988. Hillwood, which will continue to be led by chief executive Rick Patterson, is well regarded for some of its long-term projects across the United States and in countries such as Japan, Jordan, the Philippines, Argentina and Ireland.
"Ross has a solid track record of success in all facets of the business environment, with a strong background in strategy, operations and business development," the elder Perot said in a statement.
Perot shares closed at $10.88 yesterday, well below their 52-week high of $27.94.
The Associated Press contributed to this report.