Terra Lycos SA's Chief Executive Officer (CEO) Bob Davis is gone as the company's top man and will remain as a non-executive vice chairman of the company's board of directors, according to the company. The search engine and Internet access provider also announced that Ted Philip, currently chief financial officer (CFO), will move to a new senior executive role within Terra Lycos as senior vice president of strategic planning and mergers and acquisitions, the company said in a statement.
Terra Lycos made the announcements on the same day it announced pro forma revenue of US$164 million for the fourth quarter, an increase of 76 percent year-over-year. The company also said it took a pro forma loss of $96 million or $0.17 a share for the quarter. The results beat analysts' estimates of $151 million in revenue, and a loss of $0.22 a share, according to First Call/Thomson Financial.
Davis, the founder of the Lycos search engine, has taken a job with Highland Capital Partners, a venture capital firm focused on early-stage investments and will serve as a venture partner identifying investment opportunities, according to a statement from Highland. In addition to staying on Terra Lycos' board, Davis will also consult on the strategy of the company and will continue to serve on the boards of Terra Lycos' international joint ventures, the company said.
Davis is said to have had problems with senior management at Telefonica SA, the Spanish telecommunications company that controls the Terra Lycos board of directors, according to The Financial Times and The Wall Street Journal's online editions.
Davis and Telefónica conducted last-minute negotiations late Wednesday night, according to the reports. It appeared no compromise could be reached. Davis was seeking more power, a request Telefónica would not grant, the reports said. Terra Lycos declined to comment.
Philip served as the company's CFO since 1995. Elias Rodriguez-Vina will succeed Philip and previously served as business development director for GE Capital Europe for Spain and Portugal and director of mergers and acquisitions for financial services firm UBS AG.
Terra Lycos is the result of the $12.5 billion takeover in May 2000 of Lycos Inc. by Telefónica subsidiary Terra Networks SA. Since the merger Davis has been sharing responsibility for the company with Joaquim Agut, the Spanish chairman of Terra Lycos. Agut is expected to succeed Davis.
Terra Lycos owns a third of Lycos Europe. The other major shareholder is German media giant Bertelsmann AG, with a 19.3 percent stake.
Shares of Terra Lycos [TRLY] lost $0.75, or 4.6 percent, to $15.56 a share in midday trading Thursday.
Terra Lycos in Barcelona can be reached at +34-9-1452-3000, or via the Web at http://www.terralycos.com/.