NEW YORK (AdAge.com) -- In one of his first meetings with Wall Street as Interpublic Group of Cos.' chairman-CEO in early 2001, John J. Dooner Jr. began by saying he wasn't good on financial details and therefore might not be able to answer some of the questions. It was not what the Street wanted to hear.
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That recollection from an analyst underscores what ultimately doomed Mr. Dooner as CEO. While in the end it was unacceptably poor financial results that ended that tenure, the veteran ad executive showed signs almost from the start that he was not suited to the role of running a publicly held holding company.
"It's more inexperience than necessarily a deficit of skills," said Lauren Rich Fine, advertising analyst at Merrill Lynch & Co., noting that he suffered from taking over as the ad market tumbled. "John Dooner could one day be an excellent public company CEO."
Mr. Dooner, who did not return calls for comment, succeeded Philip H. Geier Jr. as chairman-CEO on Dec. 15, 2000, just as the U.S. ad industry slid into its worst downturn since the Great Depression. At the same time, Interpublic was coming out of a massive acquisition binge, picking up everything from Hollywood talent management companies to racetracks. That was compounded by Mr. Dooner's decision to pay top dollar for True North Communications in March 2001, just as the market was heading south fast.
Interpublic had too many things on its plate then, said Troy Mastin, advertising analyst at William Blair & Co. Besides breaking in a new CEO, the company was in the midst of a restructuring that merged Ammirati Puris Lintas into Lowe Worldwide and was overhauling its information technology system, Mr. Mastin said.
'Poor' crisis management
"If he had had some experience running a public company before, he may have been better equipped to handle these problems better," said Alexia Quadrani, advertising analyst at Bear, Stearns & Co. She said it was true that Mr. Dooner inherited a weak economy and problems left from previous management, but "on top of it all he handled the crisis poorly."
Many analysts shook their heads over Mr. Dooner's insistence that there would be no fallout from the True North deal, only to lose PepsiCo's $350 million account and then resign Reckitt Benckiser's $150 million assignment due to conflicts with rivals Coca-Cola Co. and S.C. Johnson & Son, respectively.
Wall Street also faulted Mr. Dooner's relationship skills. Although known for being a good client handler, he earned a reputation among analysts for being aloof and hard to reach. They said Mr. Dooner did not make a strong effort to court the financial community as his company's stock floundered.
Earnings restatement debacle
Relations did not improve after Interpublic announced a restatement of earnings covering the last five years, then proceeded to revise the total from $68.5 million to $120 million to $181.3 million. Mr. Dooner was repeatedly faulted by the financial community for not getting a handle on the problem.
"The buck's got to stop somewhere. If it doesn't stop at the CEO, where does it stop?" Mr. Mastin said.
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Bradley Johnson contributed to this report.