Riverstone Founders Resign

Riverstone's new CEO completes sweep of the management and the board of directors

December 9, 2003

3 Min Read
Riverstone Founders Resign

Question: The company you've founded is suffering from falling revenues, is besieged with scandal, is losing market share, and is badly in need of a makeover. What do you do?

Answer: Spend more time with your family, of course!

That's what Riverstone Networks Inc. founder Piyush Patel announced he would do as he resigned from Riverstone's board of directors this week (see Riverstone Founders Leave Board).

Riverstone founder Romulus Pereira also resigned from the company's board, the company announced Monday, leaving the board without a chairman. Pereira had also served as the company's president and CEO until Oscar Rodriguez's appointment in August.

Whatever the reasons publicly given, it's abundantly clear that Rodriguez and the new Riverstone management team want to put a new stamp on the company, and the departure of Patel and Pereira completes a clean sweep of Riverstone's leadership. Rather than fill the chairman of the board post, the company has appointed an independent director as a "Lead Director" to keep an eye on the board.

The turnover is not surprising, as Riverstone has had its share of bumps this year:

  • Riverstone Disappoints the Street

  • SEC Calls on Riverstone

  • Accounting for Riverstone's Problems

  • Riverstone Ailing in Asia

  • Riverstone Branded 'E' by Nasdaq

  • Kern Decreases Riverstone Stake

  • Riverstone Readies Restatement

  • Riverstone Restates, Stock Falls

  • Riverstone Oops! Level Rises

  • Nasdaq Delists Riverstone

  • Riverstone in Debt Dustup

But that's all in the past, and, though Rodriguez and his new team have been quiet so far, observers are confident that they're capable of cleaning up the mess left by Pereira, Patel, and the ancien régime.

Table 2: Riverstone Management Team, as of 5/2002

Name

Title

Romulus Pereira

President and CEO

Robert Stanton

Executive VP and CFO

John Kern

Executive VP, Worldwide Sales and Service

Suresh Gopalakrishnan

Executive VP of Engineering

Andrew Feldman

VP of Corporate Marketing and Development



Table 3: Riverstone Management Team, as of 12/2003

Name

Title

Oscar Rodriguez

President and CEO

Roger Barnes

Executive VP and CFO

Scott McMillan

VP of Operations

Praveen K. Mandal

VP of Engineering

David Ginsburg

VP of Marketing



Several nagging questions remain. First of all, is all this cleanup happening too late? "How far have Extreme Networks, Foundry Networks, and Cisco Systems gotten during Riverstone's time of disruption?" asks Chet White, an analyst with Merriman Curhan Ford & Co.

The company does have something to build from, though. As noted in a recent survey of carrier employees and executives conducted by Heavy Reading, Riverstone gets high marks from incumbent service providers as a metro Ethernet supplier.

Table 1: Metro Ethernet Equip. Ratings by 69 Incumbent Carrier Respondents

RANK

VENDOR

RECOGNITION

PRICE

PERFORMANCE

QUALITY & RELIABILITY

SERVICE & SUPPORT

1

Riverstone

36.2%

16.2%

16.3%

17.5%

9.3%

2

Extreme

46.4%

8.1%

4.7%

2.5%

2.3%

3

Foundry

43.5%

0.0%

0.0%

0.0%

0.0%



Riverstone declined to comment for this piece, citing its end-of-quarter quiet period.

— Phil Harvey, Senior Editor, Light Reading

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