Hertz shares were up more than 3% in pre-market trade on Monday after the company’s CEO resigned.
In a press release, the company announced that Mark Frissora would step down as chairman and CEO, citing personal reasons.
The company said that Brian MacDonald, president and CEO of Hertz Equipment Rental Corporation, will serve as interim CEO of Hertz, Linda Fayne Levinson, independent lead director of the Hertz board, has been appointed independent non-executive chair of the board, and the company has initiated a search process to identify a permanent CEO.
Frissora’s resignation comes after what has been a tough summer for Hertz.
On August 20, shares of the rental car company fell sharply after Hertz withdrew its full-year financial guidance and review results from its 2011, 2012, and 2013 fiscal years. With that announcement, the company said only that its 2014 results would be “well below” the low-end of its guidance provided in March, which said the company would earn $US1.70-$2.00 per share on $US11.4-$11.7 billion in revenue.
Additionally, according to an August 20 filing with the SEC, activist hedge fund manager Carl Ichan holds a 38 million share stake, equivalent to about 8.5% of the company, in Hertz.
In his filing, Icahn said he intends to hold discussions with the company’s management, “relating to shareholder value, accounting issues, operational failures, underperformance relative to its peers and [Icahn’s] lack of confidence in management.”
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