Reynolds wraps it up at CBS [updated]
Updated: Reynolds is retiring in August but giving up his CFO post on July 20.
CBS is losing its top bean counter.
Fred Reynolds, the longtime chief financial officer of CBS, is retiring next month and will be replaced by up-and-comer Joe Ianniello.
Reynolds, 58, has been CBS Chief Executive Leslie Moonves' Wall Street wingman for countless years. He almost left the company in 2005, but Moonves, who commands extreme loyalty from his underlings, lured him back to CBS, "where he belongs," Moonves said at the time.
"It is impossible to overstate the contribution that Fred has made to the CBS Corp. through his many years," Moonves said this morning in a statement. "He has guided our finance division through virtually every major transformative event of the last 15 years, from the acquisition of Westinghouse of CBS in 1995, to our Infinity [radio] acquisition the following year, to the Viacom-CBS merger of 2000 and the subsequent launch of CBS Corp. as a stand-alone company in 2006."
The departure of Reynolds comes at a tough time for CBS. Although the network is doing well, the company -- like many media conglomerates -- has been battered by the economy and a soft advertising market. Earlier this year, Standard & Poor's downgraded CBS credit, and Wall Street has been monitoring the company's balance sheet. Last month, CBS refinanced $1 billion of that debt at higher interest rates to give the company a cushion and more breathing room.
Reynolds had been considered an all-star by Wall Street. "Reynolds has an excellent reputation and is known for his conservatism, his focus on the balance sheet and his desire for CBS to maintain an investment grade rating. We believe Mr. Reynolds' departure is a slight negative for the stock," Wachovia senior analyst Marci Ryvicker said in a research note this morning.
The only noticeable blot on Reynolds' record was CBS' decision last year to spend $1.8 billion in cash to buy Internet company CNET. Moonves had hoped that the acquisition would make CBS a significant digital player. Instead, the deal depleted its cash reserves at a particularly bad time, just as the recession was delivering a blow to CBS' advertising-reliant businesses.
Reynolds has been one of CBS' most highly paid executives, with a compensation package valued at $8.6 million in 2008, according to regulatory filings. He will leave the company Aug. 15, when his contract expires, but is giving up his CFO title on July 20, just before the network announces its second-quarter earnings.
Ianniello said his first priority is to "make sure that we have enough gas in the tank to take us where Leslie wants to go." Don't look for any big deals anytime soon though. "We feel comfortable right now, we don't feel that we need any acquisition, but we are going to continue to invest in premium content going forward."
-- Meg James
Photos: Top left, Fred Reynolds; bottom right, Joe Ianniello. Credit: CBS