Audet family to pass baton to new CEO of Cogeco
Louis Audet will step aside as chief executive of Cogeco Communications Inc. this fall and help with the transition to his successor, the first CEO outside the Audet family and only the third in the cable company’s history.
Philippe Jetté, a senior executive who currently runs Cogeco’s business unit, will become the CEO. And Audet — who has led the Montreal-based company controlled by his family for 25 years since the resignation of his father, founder Henri Audet — will become executive chairman. Both changes will be effective as of Sept. 1.
The board began the succession process in 2016 when Audet, who turns 67 in a few weeks, informed them he plans to exit operations by his 70th birthday, Audet said at a news conference in Montreal on Tuesday. All the candidates were internal, although there were no potential candidates from the Audet family at this time.
Both Audet and Jetté emphasized that the strategy will remain the same.
“This is an opportune time to pass the baton to the next generation of managers,” Audet said. “It’s not a change of strategy or philosophy, it’s a renewal of our team.”
Audet plans to stay for two to four years to ensure a smooth transition and assist with major decisions such as acquisitions. He said he has no political aspirations.
The management changes prompted analysts to speculate whether Cogeco might once more become a takeover target for Rogers Communications Inc., which owns 5.6 per cent of Cogeco and 11.7 per cent of its holding company.
“These analysts are living in fantasy land. Our company is not for sale,” Audet said.
After 60 years in operation, Cogeco is now worth $2.3 billion. In comments translated from French, Jetté said he’d pick up the challenge of ensuring growth.
Jetté is an electrical engineer with two decades of experience in the telecom industry. He previously worked in wireless roles at BCE Inc. and Rogers Communications Inc. before joining Cogeco in 2011. He took over Cogeco Peer 1 in 2015, receiving praise for stabilizing the business at a tough time. Jetté said his top priority is to ensure a disciplined transition and that he’ll remain focused on Peer 1 until the fall.
Jetté’s wireless experience prompted speculation over whether Cogeco will make a foray into the mobile business, the fastest growing and largest segment of Canada’s telecommunications industry.
Cogeco is exploring the idea, Audet said, but will only offer wireless services if it can do so profitably.
“We don’t have big ambitions in that field, but there is some potential,” he said.
Analysts reacted positively toward the changes to move professional management from the family.
“While we believe CCA moving towards professional management is certainly a positive, we would not immediately assume any significant shift in the company’s strategic direction,” Barclays analyst Phillip Huang noted to clients, citing less emotional attachment to assets and more disciplined, rational capital allocation.
But Huang doesn’t see a clear path for Cogeco to enter the wireless business given the government’s policy for facilities-based competition.