October 17, 2005

Mike Zafirovski will replace Bill Owens as chief executive officer of Nortel Networks Corp.

Wall Street appeared happy with the move, sending Nortel's shares up almost 7 percent to $3.53 per share.

"Mike Zafirovski has the kind of proven, team-building leadership that has seen him create significant new value during his career in two of the world's most important global corporations," said Harry Pearce, chairman of Nortel's board.

"He's the right leader to build on the important work of Bill Owens-and take Nortel to the next level."

The move is notable for Nortel as the company works to refresh its scandal-laden image.

Owens took the company's reins last year after several senior Nortel executives were embroiled in an accounting scandal.

Investors had hoped Owens would quickly clean up the company's accounting situation and re-energize Nortel.

However, critics argue Owens has largely failed to manage a turnaround.

"Bill re-established stability within Nortel and credibility with all its stakeholders.

He guided the company in becoming current in its financial reporting and maintained the loyalty of our customers.

Mike can now build for the future on the strong foundation Bill Owens has given us," Pearce said.

The appointment also gives Zafirovski some validation; he was passed over for Motorola's CEO position when Sun Microsystems Inc.'s Ed Zander took the company's helm last year.

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Zafirovski joined Motorola in 2000 to head up the company's handset business, and from 2002 to 2005 he served as president and chief operating officer.

Prior to his stint at Motorola, Zafirovski worked at General Electric in a succession of senior executive positions.

"I've had the privilege through my career of working for organizations whose success was based on understanding and leveraging tremendous internal brainpower and human capital," Zafirovski said.

"And that's why I'm so excited about Nortel.

I see those same characteristics at play. They're the foundation of Nortel's tradition of leadership and innovation, its global presence and its iconic status for technical excellence."

Source: RCR News