In its second-largest acquisition, Amazon buys the company for $970 million.
John T. Byrne may end his five-month tenure as chairman of e-retailer Overstock.com because of what he calls his son’s “jihad” against industry reporters and analysts. The decision won’t come until the April board meeting, he tells InternetRetailer.com.
John T. Byrne may end his five-month tenure as chairman of e-retailer Overstock.com because of what he calls his son’s “jihad” against industry reporters and analysts. Patrick Byrne, CEO, requested his father’s help last year to develop company management. Following published reports last week that he may leave, John Byrne tells InternetRetailer.com that his departure still is up in the air. “We intend to discuss this matter at our regularly scheduled April board meeting,” he says. “We have a highly competent board. I am considering requesting someone else take the chair. The son-father relationship may not be the most constructive for the company’s progress.”
Patrick Byrne is angry with analysts and short-sellers who he believes are working together to weaken Overstock.com’s position in the market. Overstock.com has yet to post an annual profit since it went public four years ago. Byrne has made his dispute with reporters and analysts very public, and it is that activity that is causing John Byrne to re-think his role at Overstock. “I can’t tell whether this jihad adds to the value of the stock or subtracts from it, but what it does is take from Patrick’s time,” John Byrne told the Wall Street Journal last week. He told the paper that if he resigned as chairman he would continue to serve as a director.
Companies should not be distracted or focus too much on short-selling activity, says Jim Okamura, senior partner at J.C. Williams Group Limited, a global retail consulting firm.
“Any senior executive from a publicly traded company would advise that the best way to foil short-sellers is to keep growing financial operations so short-sellers’ tactics will backfire on them,” Okamura says. “And that is what I’ve liked about Overstock over the last few years. They’ve had a nice growth curve. Though last year they fell short of their financial goals, the best thing management can do is focus on their core business and not be concerned at all with short-sellers, never mind conspiracy theories.”
John Byrne served as a director of Overstock.com, No. 19 in the Internet Retailer Top 400 Guide to Retail Web Sites, from October 1999 until October 2002; he rejoined the board as a director in June 2004. A veteran of the insurance industry, John Byrne recently retired as chairman of White Mountain Insurance Group and Montpelier Re. He is a former CEO of White Mountain, GEICO and Fireman’s Fund.