May 15, 2018 5 months 1 week ago

Louis Audet to step aside at Cogeco; Jetté promoted to CEO. And no, it's not for sale, thanks

MONTREAL - Cogeco Inc. and Cogeco Communications today announced Philippe Jetté will become president and CEO of both public companies effective September 1st, 2018. Current CEO Louis Audet, who has been in the role for 25 years, recommended Jetté and on that day, Audet will become executive chairman of the board.

The companies are publicly traded, but the Audet family owns control of the voting shares.

Jetté (pictured at left with Audet at the press conference Tuesday), an electrical engineer by training, joined Cogeco as senior vice-president and chief technology and strategy officer in 2011, after running his own consultancy for a number of years after leaving Bell Canada.

In 2015, he was made president of Cogeco Peer 1 "where he successfully stabilized the business, preparing it for future growth in a very challenging environment," reads today's press release. An announcement regarding his replacement at Cogeco Peer 1 will be made in the coming weeks.

Jan Peeters, currently chairman of the Board of both companies, will stay on and become lead director instead, effective September 1st, 2018.

As executive chair, Audet will continue in an active executive capacity focusing on major business issues and strategies while working closely with and supporting Jetté. It's worth noting that after Louis took over the company from his father Henri, Cogeco has grown from a small Quebec-based cable operator with about 40,000 customers to an important Canadian communications company, with a solid foothold in the U.S. as well, with revenues of over $2.3 billion annually.

The company that would become Cogeco was established in 1957, when Henri Audet obtained a broadcast license for CKTM-TV, a Radio-Canada affiliate in Trois-Rivières, Que. Currently, Cogeco provides residential and business phone, cable and internet services across Quebec and Ontario and in 11 US states. Cogeco Peer 1 provides business IT services including network connectivity, hosting and cloud services to clients in more than 80 countries; Cogeco Media owns and operates 13 Quebec radio stations as well as a proprietary news agency. The company employs about 5,200 people.

 “This allows us to have a smooth transition in the spirit of continuity without being rushed...no one lasts forever." - Louis Audet

When Jetté takes over, he will become the third CEO in Cogeco’s 60-year history, and the first non-Audet. At the announcement, Louis Audet emphasized that the family remains the controlling shareholder and would continue to play a leading role. “The family is committed to continue to control this company and let it grow as we done for the last 60 years,” Audet said, adding that Jetté and his team would have the family’s full support. Audet said it was “premature” to speak about specific family members being trained for leadership positions, and said no family members had applied for the CEO position.

Audet praised Jetté for his work with Cogeco Peer 1, which he said stabilized the company and “allowed it to get back on to the path of growth.”

Audet, 66, said he advised the board in April 2016 that he intended to step away from the day-to-day operations of the company by age 70. Since then, he says, “the transition “has been a very systematic and disciplined process.” He says he plans to continue as executive chairman for “the next two to four years, most likely two to three years” to help with major decision making and provide support for Jetté during the transition period. “This allows us to have a smooth transition in the spirit of continuity without being rushed...no one lasts forever,” he later added in response to a journalist’s question.

Jetté, for his part, said it was “an immense pleasure and honour” to be named the company’s new CEO and help “write the next chapter” of the company’s history. He said the company’s overall strategy would not change and the current leadership would remain in place. He says he remains focused on Cogeco Peer 1 until Sept. 1. Jetté said the next CEO of Peer 1 would be named in the coming weeks or months.

Audet said he sees several “big opportunities” for the company in the coming years, specifically expanding its reach into the U.S. cable market. “In Canada, acquisition opportunities are limited, but in the U.S. there’s still a lot of potential.” He says the company has also been “exploring” the possibility of entering the Canadian wireless market. “The sector of services to large businesses is the only sector where we’re not looking to expand at this time.”

He unequivocally dismissed speculation about a Rogers takeover (something he is asked by journalists and analysts at literally every opportunity): “Our company is not for sale, nor is any part of it for sale...and that’s not our intention.”