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Ex-Itron CEO to return after stocks see slide

Thu., Sept. 1, 2011

LeRoy Nosbaum reclaimed his executive parking spot at Itron Wednesday afternoon.

After a 20-month retirement, Itron’s former CEO was reinstated to that job by the Liberty Lake company’s board of directors.

Nosbaum, 65, guided Itron through significant growth from 2000 to 2009. Itron is the area’s largest publicly traded company in total sales and market capitalization.

Malcolm Unsworth took over for Nosbaum in December 2009, and also held the posts of president and board member. He has retired from all three of those posts, according to a news release. He joined Itron in 2004 after more than 20 years working for competitor Schlumberger.

Nosbaum said he told Itron’s board of directors he was happy being retired, but was willing to return to offset a 33 percent stock erosion that began 18 months ago.

Initially spun from Spokane power utility Washington Water Power (before becoming Avista Corp.) in 1977, Itron has become the leading hardware maker and service provider for the electric, gas and water utility industry. Its 2010 sales were $2.3 billion.

Two analysts said the appointment was well-timed and a necessary move.

“Itron’s stock has been extremely weak lately,” said Ryan Connors, an analyst with Janney Montgomery Scott LLC. But its stock price doesn’t fully reflect Itron’s market value, he said.

“While we believe Mr. Unsworth did a solid job in the CEO position, it’s not surprising the board decided it was time for a change given the languishing stock price,” Connors said.

Michael Horwitz, managing director with Robert W. Baird, based in Milwaukee, said the board was savvy in going back to the guy who helped Itron grow to the size it is.

“LeRoy was the guy who won some very large deals for Itron in his time there,” Horwitz said. “LeRoy must be feeling pretty confident in his ability to get things changed,” he added.

Horwitz said he suspects Itron will have to make some operating adjustments over the next 90 days before the investor community looks closely at the company’s stock.

Nosbaum said he’s watched the company’s stock slide since 2010 and concluded the problem has been a struggle to explain its long-term strategy to investors and customers.

“Today we’re financially strong as a company. We’re doing very well in the business we’re in. Now we have to plan for the next future of Itron, and to continue to grow and to be successful around the world,” he said.

Nosbaum did not set a specific timeline for his second round as CEO.

He said he had two goals: “First, to develop a clear action plan and a long-term strategy, and make sure internally that we’re all on that road and moving in that direction.”

The second, he said, is to find a successor “who is comfortable in the view of our investors, our customers and our employees.”

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