Darren Entwistle is stepping down as chief executive of Telus Corp, but his influence in running the company he built from a regional telephone service into a $25 billion national wireless player will remain.
After 14 years as president and CEO, Entwistle announced Monday that he is taking on the executive chairman’s role at the company he helped grow into one of Canada’s three major telecommunications companies, alongside Rogers and Bell.
Canaccord Genuity analyst Dvai Ghose said Entwistle will remain at the Vancouver-based company for now.
“He will continue to be in charge of strategic, operational, financial and executive succession planning,” Ghose said in a research note.
This will help ease chief commercial officer Joe Natale into the CEO role and shareholders will benefit from Entwistle’s experience, Ghose said.
“Entwistle remained very involved with Telus leadership and the buck will still stop with him.”
Analyst Iain Grant, a long-time observer of Canada’s telecommunications industry, said Entwistle saw years ago that wireless communications would be profitable.
“Darren recognized that the old ways were not tenable,” said Grant, managing director of the SeaBoard Group in Montreal.
Entwistle started his career at Bell, where his father worked, and went on to be president of U.K.-based Cable & Wireless Communications before return to lead Telus at age 37.
He helped transform Telus by shelling out what was then considered a staggering $6.6 billion to buy Clearnet Communications, an early cellphone service provider, in 2000, just after he became CEO.
“People were shaking their heads and saying, ‘Oh this will never work and Darren must have been smoking something,'” said Grant. “In fact, he has turned out to be prescient. That was probably the biggest single move in the telecommunications industry at the time.”
The bulk of its revenues — 82 per cent –now come from wireless and data, Grant said.
Entwistle, 52, will be replaced by Natale on May 8, when the company holds its shareholder meeting in Vancouver.
He takes the position of executive chairman of the Telus board, following the retirement of chairman Brian Canfield, who has spent 58 years with Telus and its predecessor company B.C. Tel.
Natale joined Telus in 2003 as an executive vice-president and is expected to remain in Toronto.
“There’s a time when these individuals run out of steam, quite frankly,” analyst Eamon Hoey, of Toronto-based Hoey Associates Management Consultants Inc, said of Entwistle’s change of role.
“I think with Joe Natale taking over from him, we’re going to see a nice smooth change of command,” Hoey said.
Entwistle’s time as CEO hasn’t been without some bumps.
He was unable to buy wireless provider Microcell Communications, the originator of the Fido cellphone brand, in 2004 and was outbid by rival Rogers, which paid $1.4 billion.
And Entwistle was at the helm for a lengthy labour dispute with unionized workers in British Columbia and Alberta between 2000 and 2005.
The Telecommunications Workers Union couldn’t immediately be reached for comment on Entwistle’s time as CEO.
Unlike its major competitors, Telus hasn’t pursued a strategy of buying TV, radio stations or sports teams to use as content for the mobile phones and tablets it sells. Instead, Telus identified electronic health services a number of years ago as an area of growth to offset declines in some of its older telecommunications services.