Tellabs Inc. announced that Krish Prabhu plans to resign as president and CEO by March 1, 2008. Prabhu, 53, has served in the positions at Tellabs since 2004. Tellabs’ stock fell more than 4% to $7.69 following the news.
“The Tellabs team has successfully broadened the product portfolio, established new relationships with large service providers, and made progress in repositioning the company,” Prabhu said. “This is the right time for a new leader to begin the next chapter at Tellabs.”
The company also announced that Tellabs’ Board of Directors authorized an additional $600 million in common stock repurchases. This comes in addition to the remaining $176.1 million under a repurchase program authorized in July 2006. Together, the share buybacks now represent about 22% of Tellabs outstanding shares. Since 2005, Tellabs has repurchased 50.9 million shares at a cost of $513.9 million, the company added.
Tellabs said it will use about half of its nearly $1.4 billion in cash and other securities for the program.
In a report, UBS said the repurchase program will likely reduce the chances of an acquisition by another company, specifically Nortel Networks Corp., which the firm identified as a likely suitor in the past.
Tellabs CEO on the way out
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