Compaq's CEO Search Ends

Electronic News, July 26, 1999 by Arik Hesseldahl

New York-Compaq's quest to find a new chief executive officer came to an end Thursday as the company announced that its board had selected an insider, acting Chief Operating Officer Michael D. Capellas, 44, to lead the company.

Chairman Benjamin M. Rosen, who had led the April boardroom ouster of former CEO Eckhard Pfeiffer, praised Capellas in a letter to shareholders.

"In the end, the choice was easy," Rosen wrote. "In a field of excellent candidates, Michael was clearly superior." Many had speculated that Compaq would select an established executive with a track record for running a company as complex as Compaq. And Capellas' lack of an established track record seems to have left some observers wondering if he has what it takes to right the listing ship that Compaq has become.

"The fact that they have filled the spot creates some sense of security," said Bruce Stephen, an analyst with International Data Corp. in Framingham, Mass. "He's going to have to prove himself and show some fairly strong decision-making by publicly weeding out the problems."

Capellas' career has been a wide-ranging one, including stints at Schlumberger, Fairchild Semiconductor, SAP America and Oracle.