Sonic Healthcare Ltd (ASX: SHL) shares are under pressure on Thursday.
In morning trade, the healthcare company's shares are down almost 1% to $21.56.
Why is this ASX 200 stock falling?
Investors have been selling the company's shares this morning after it announced the exit of its CEO, Dr Colin Goldschmidt, after over three decades in the top job.
According to the release, Dr Goldschmidt plans to retire at its annual general meeting (AGM) in November.
But the ASX 200 healthcare stock has acted fast to find a replacement. It advised that Dr Jim Newcombe will become its managing director and CEO following the AGM. He joined Sonic Healthcare eight years ago and is currently the CEO of Douglass Hanly Moir Pathology in Sydney. It is Sonic's founding practice and one of its largest laboratories globally.
The company highlights that in that role he has led a significant uplift in earnings and margins through strategic initiatives in the areas of operations, marketing, and people. He also has extensive experience in governance, strategy, and quality improvement in both the public and private sectors and was previously an actively practising doctor in clinical and laboratory medicine.
In addition to this appointment, the ASX 200 healthcare stock notes that Evangelos Kotsopoulos will be appointed to the newly created position of chief operating officer.
Kotsopoulos is currently the CEO of Sonic Healthcare Europe and Sonic Healthcare Germany, overseeing Sonic's operations in Germany, Switzerland and Belgium.
Management commentary
Commenting on the appointment of Dr Jim Newcombe, Sonic Healthcare's chair, Professor Mark Compton, said:
We are delighted that Dr Jim Newcombe will succeed Dr Colin Goldschmidt in leading Sonic Healthcare, preserving its unique Medical Leadership culture while embracing the transformational changes in healthcare which Sonic is leading in Australasia, Europe, the UK and the USA.
After thirty-two years as Sonic's CEO, Colin has decided it is the right time to retire, and the Board respects his decision. Colin has led Sonic's expansion from a single laboratory in Sydney onto the global stage to become the third largest pathology player in the world by developing and committing the company to the culture of Medical Leadership.
Professor Compton believes the new leadership model will be a good thing for the company. He adds:
This leadership approach is now firmly embedded within Sonic Healthcare and incorporates an understanding of doctors and the medical profession, linking directly to operational and cultural attributes focussed on care for staff and highest quality service to clinicians and patients. We thank him sincerely for his incredible vision and dedication over so many years.
Dr Goldschmidt feels that he is leaving the company in a strong position. He said:
It's been a great honour and privilege to lead Sonic Healthcare over the course of my long tenure as CEO. While the decision to retire was never an easy one, the time is now right. The company is in a very strong position, both culturally and financially, and is well set for ongoing growth.
