Ferrari loses ground on shock boss resignation
Ferrari’s “super CEO” Sergio Marchionne will no longer be heading the company up. Mr. Marchionne, who is widely regarded as something of a superstar, having led Ferrari and Fiat Chrysler through the financial crisis and their respective IPOs, had intended to remain in his position at Ferrari – but a health crisis has put an end to those plans. Famous for his brash comments about the auto industry, and his low-fashion style, Marchionne will be succeeded at Ferrari by board member Louis Camilleri.
Ferrari’s share price dipped on the news Marchionne was resigning – but it’s still up by 34% so far this year
SOURCE: Yahoo Finance
Marchionne spun off Ferrari in 2015, and its shares have returned 150% to investors since. He’s a hard act to follow for many reasons, but undoubtedly, this is one of the big ones. His resignation came as a shock last week: Marchionne was in hospital undergoing surgery on his shoulder, but has suffered “serious complications” leading to an “irreversible” condition. Hence, according to Fiat Chrysler: “Mr. Marchionne will be unable to return to work.”
In a statement, Ferrari said the company responded “with deep sadness” to the news of Marchionne’s condition, and thanked him “for the extraordinary contribution he has made in recent years at the helm of Ferrari.”
Unsurprisingly, shares in Ferrari dropped around 4% on the back of the news. However, as Dominion analyst Christian Cole noted: “The negative move reflects disappointment at the loss of highly rated Marchionne who revived the fortunes of all previously ailing FIAT group companies rather than disappointment at his successor.”
Dominion holds Ferrari in its Global Trends Luxury Fund.
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