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GT today announced the employment of a former EK executive, Robert Keegan, as President and Chief Operating Officer. Will this make any difference to the fortunes of battled GT shareholders and employees?

GT states in its announcement:

"A strategic Goodyear commitment to build a stronger management team and to focus more intently on the consumer was reinforced today with the announced election of former Eastman Kodak executive Robert J. Keegan as president, chief operating officer and director of the world's largest tire company."

What is potentially good about this announcement?

1. GT appears to have recognised that it needs to build a stronger management team! - It is about time, and a lot of value has been wasted in the past couple of years before this became apparent to GT's Board of Directors.

2. Finally another executive at GT is elected to the Board of Directors. Mr. Samir Gibara is no longer the sole source of information to the non-executive Board members.

What is not good about this announcement?

1. Mr. Samir Gibara appears still to be in control. For a thorough change at GT to take place, he has to be replaced!

2. Keegan has been with EK for 28 years, and unfortunately EK has not got a good track record when it comes to genearting shareholder value.

3. Keegan owned 1265 EK shares! Which is not a great vote of confidence in the value he, as a senior executive at EK, felt he could create for shareholders. So shareholders at GT might not see much change in GT's executives financial commitment to GT shares, and consequently the culture of shareholder value will not progress much with this appointment.

4. Value at GT can be created to a considerable extent by getting costs in line with revenue, this is not Keegan's expertise, and this major effort is not progressed with this announcement.

What is uncertain about this announcement?

1. Why was it not considered a loss for EK that Keegan left? Why did EK have in place a recently appointed - former PG executive - to take over Keegan's position?

2. I agree that GT needs marketing skills; but is that the only additional management skill required, and are Keegan's skills the most appropriate for GT?

Today's announcement from GT also states:

"This will allow me ("me" is Samir Gibara), as chairman and CEO, to concentrate my effort on Goodyear's strategic opportunities and to continue to grow the company profitably".

Mr. Gibara has some nerve and no shame (I wish it was the other way around).

What is he reading, if he believes he has grown the company profitably the last few years?

I - as a shareholder - really do not want Mr. Gibara to be able to get approval for any more strategic opportunities he can think of, as a shareholder I have suffered enough from what he has done allready!

Mr. Gibara is totally out of tuch with reality, and unfortunately, I fear that today's appointment of Mr. Keegan is just another step to prolong Mr. Gibara's rein, and delay his inevitable downfall. - Sadly, this will only further prolong the suffering of GT shareholders and employees.

Take care.

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