Darren Entwistle leaves Telus ‘in good hands’

The man who led Telus Corp.’s evolution from a Western Canada-focused home-phone services provider to what one analyst called “arguably the most successful wireless carrier in North America” is stepping down as CEO. The company said in a press release Monday that Darren Entwistle will leave his post as president and CEO of Telus on May 8, the date of Telus’ annual general meeting, and be replaced by Joe Natale, who is currently chief commercial officer and executive vice-president. Entwistle was appointed CEO of Telus in 2000, coming over from Cable & Wireless UK and Ireland, where he was president. Within months of assuming that position, he led the acquisition of Clearnet Communications Inc., which catapulted Telus to being the biggest wireless service provider in Canada, the company said at the time. He inherited a deal already in place for Telus to take over QuebecTel, which gave the company a foothold to provide home-phone, Internet and Internet-protocol-TV services outside of Western Canada. In a 2000 interview with the Network Letter, which was later folded into The Wire Report, Entwistle said more acquisitions could be expected, though he dismissed the notion of owning broadcasting assets, as competitors such as BCE Inc. had done. Entwistle’s stated opposition to getting involved broadcast media while continuing to grow by acquisition in other areas held true over his time as CEO. Just last year, Telus added to its wireless assets with the purchase of Public Mobile, though its attempt to acquire Mobilicity was prevented by the federal government. “I think gets a lot of credit for putting in a long-term vision for the company, put in writing when he first started,” Drew McReynolds, an analyst with RBC Dominion Securities, said in a phone interview Monday. “And really hasn’t changed in 13 or 14 years. He’s certainly done what he said he would do, and I think the organization as a whole is a reflection of that focus and drive. “I think legacy will be quite good.” In a research note Monday, Canaccord Genuity analyst Dvai Ghose said Entwistle helped turn Telus into “arguably the most successful wireless carrier in North America, including record low churn that reflects customer friendly policies.” Last year, Telus was the only one of the three incumbent wireless companies to see an annual decrease in the number of accepted complaints collected by the Commission for Complaints for Telecommunications Services. Ghose also said that in 2000, Telus was the first major service provider to invest in data centres, which is a strategy competitors have since emulated. He added that Entwistle’s work with Telus TV was “pioneering work … which today is a primary weapon in winning TV and broadband share from Shaw .” Ghose said that while the timing of Telus’ announcement was surprising, the decision to have Natale succeed him was not. He said Natale has been “groomed” to succeed Entwistle. “Consequently, while we are very sad to see Entwistle move on from the CEO position, in our view, TELUS remains in good hands,” Ghose said. Ghose said that “Natale should also take a lot of credit for TELUS’ numerous successes in the wireless and wireline arenas” and that the “handover is coming at a relatively stable time” for the company. Natale has been with Telus since 2003, according to his bio on the Telus website, prior to which he held senior positions with KPMG Consulting. He co-founded PNO Management Consultants Inc., which was bought by KPMG in 1997, the website says. Scotiabank analyst Jeff Fan also said that the transition to Natale as CEO should go well. “We believe this will be a smooth transition because Joe Natale has been groomed for the CEO role for the past few years,” Fan said in research note Monday. “Mr. Natale has done a great job on the operations, including spearheading the TELUS TV expansion in the west and adopting a more consumer-friendly approach in both wireless and wireline, without diluting total margins or returns.” McReynolds said the transition to Natale from Entwistle is unlikely to result in major changes at Telus. “Joe and Darren have obviously worked closely over the last couple of years,” he said. “I really don’t see a lot of surprise or change of direction here.” Ghose said it was a positive for Telus that Entwistle is continuing with the company in the role of executive chairman. “In our view this will help ease Joe Natale into the CEO role, while shareholders will still benefit from Entwistle’s skills, passion, commitment and experience,” Ghose said. Telus said Entwistle will continue to be based in Vancouver, while Natale will work in Toronto. Other leadership changes Telus announced Monday included that Brian Canfield, whom Entwistle replaced as CEO in 2000, is stepping down as chairman and being given the title of chair emeritus. As well, board member Dick Auchinleck is becoming lead director. In this role, Telus said Auchinleck “will provide leadership to foster the effectiveness of the board in conjunction with Mr. Entwistle while ensuring that the board functions independently of management as and when required.” McReynolds, Ghose and Fan said that Canfield’s decision to step down as chairman likely drove the timing of the other leadership changes announced Monday. — With reporting by Derek Abma at dabma@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Darren Entwistle leaves Telus ‘in good hands’

News | March 31, 2014

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Darren Entwistle leaves Telus ‘in good hands’

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