Surprising Speculation on Marchesano’s Next Move
Michael Marchesano, currently executive vice president and chief transformation officer at The Nielsen Company, is leaving the company at the end of the month, a spokeswoman confirmed Wednesday. One source speculates he may be positioning himself as a buyer of Nielsen Business Media should it go on the block.
Marchesano, formerly CEO of VNU Business Media, now Nielsen Business Media, publisher of Billboard, AdWeek and BrandWeek, was promoted to the newly-created position two months after the $9.7 billion acquisition of VNU in June 2006 by a consortium of private equity firms called Valcon Acquisition B.V. The late Robert Krakoff succeeded Marchesano as CEO.
Nielsen Business Media COO Greg Farar has been interim CEO.
A memo dated June 10 to employees from chairman and CEO David Calhoun states that Marchesano made the first move. "Mike Marchesano has informed me of his decision to leave the company, effective July 31," says Calhoun in the memo.
However, one source counters that he was pushed out. "I suspect (strongly) that he was pushed out because there is no role for him," says the source.
Indeed, when Marchesano was ushered upstairs to his corporate role as chief transformation officer, some saw that as a reward without any legitimate mandate. "It was designed to placate him and reward him for moving aside so Bob Krakoff could assume his role. If VNU thought he was a strong manager they would have put him back in Bob’s role after Bob died," says the source.
But a second source says that Marchesano has been contemplating a move for some time now, that the departure was his choice and that his role, if frustrating, was indeed vital, and successful. "With the transformation job, he probably realized that wasn’t what he wanted to do for the rest of his life. It pulled him away from publishing. Transformation is purely leveraging suppliers and cost cutting."
The memo goes on to note that Marchesano has laid the groundwork for the company’s transition to an integrated platform. "Mike and his team have created a strong foundation of business process improvement and efficiency initiatives that have achieved significant early results. We now have a sturdy platform upon which to transform The Nielsen Company into an integrated operating company."
"They took $300 million of costs out of the business," says the second source. "I don’t know how much of that was Mike, but that’s the office that it went through."
The memo does not give any details on Marchesano’s future plans, except to say that his departure will "allow him to focus full-time on the next phase of his career as a business leader in the media and communication sector."
That next phase might be as owner of the company, the second source speculates. Marchesano may be anticipating a sale of Nielsen Business Media and would rather be on the outside as a prospective buyer. He’s already been speaking with several private equity firms, says the source. "Calhoun said in a conference call that if the right person came along he’d sell it. Mike wants to get a head start and be ready for that. They could get $1.5 billion for it and Mike would be circling on that," says the second source who adds that Nielsen Business Media has EBITDA of about $150 million.
As for Bob Krakoff taking over as CEO following Marchesano’s move upstairs, the source says Valcon was already committed to Krakoff in some fashion for his role in the acquisition. "They had committed to Bob along the way and they [subsequently] sweetened the pot for Mike."
So why didn’t Marchesano return to his CEO role? "Bob made some changes Mike probably didn’t agree with," says the second source. "He felt if they’re going to sell it, why not be on the outside?"
Marchesano had not responded to inquires from Folio: at presstime.