Stryker Names New CEO

Stryker Corp. is no longer without a chief executive. The Kalamazoo, Mich.-based device giant named Kevin A. Lobo, recently head of its orthopedics unit, as its president and CEO after a search of nearly eight months.

Lobo, 47, will take the reins from Curt R. Hartman, Stryker’s chief financial officer (CFO) and interim CEO. Former CEO Stephen P. MacMillan was forced out in February following an internal scandal of an inappropriate relationship with a corporate flight attendant, leaving Stryker without a permanent leader for nearly eight months. Hartman will “pursue interests outside of Stryker,” according to the company, but will stay on in an advisory capacity while the firm searches for a permanent CFO.

Lobo also will have a seat on the company’s board. He joined Stryker in April 2011 to lead the company’s neurotechnology and spine division, which had been formed earlier that year following Stryker’s acquisition of Boston Scientific Corp.’s neurosurgery division, which sells stents used to open arteries and tools used in vascular surgery and spine procedures.

In June 2011, Lobo was promoted to lead Stryker’s orthopedics division, which had $3.7 billion in sales in 2011. Former division chief, Michael Mogul, left to skipper ortho company DJO Global Inc.

The change at the top comes at a time when Stryker, like many other firms in the sector, is grappling with a sluggish U.S. orthopedic market and looking to expand its reach overseas.

Lobo served as a senior manager at Johnson & Johnson for nine years before joining Stryker. Though experienced, he is a relative unknown to investors and has never held a chief-executive post. At JNJ, he eventually rose to the rank of worldwide president of Ethicon Endo Surgery, a division that in 2011 sold $5 billion in surgery tools such as gastric bands and staplers for closing surgical wounds.

“It seems like he’s got the right makeup to lead the company,” Matt Taylor, a Barclays Bank PLC stock analyst to the Reuters news service. “The international segment always comes up as an opportunity because their [market] share overseas is lower than here. With the U.S. market growing so slowly, that’s always a consideration.”

The company is touting Lobo’s international experience. According to Stryker, he has a “broad and diverse 25-year business career” that includes executive positions in general management and finance. After holding finance positions with KPMG and Unilever Canada, he joined Kraft Canada in 1992. He subsequently held executive positions at Rhone-Poulenc, including roles based in Europe as Worldwide Corporate Controller of the chemical spin-out, Rhodia, and general manager of Specialty Phosphates in Europe. He also worked in Canada while at JNJ.

William U. Parfet, non-executive chairman of Stryker’s board said the company’s “very thorough search” included external and internal candidates.
“He is a talented executive with a broad range of global experience and he knows our company and industry extremely well,” Parfet said. “Since joining Stryker in 2011 he has proven to be a highly effective leader for our Orthopaedics Group, and he has won the confidence of employees, customers and the Board. We are excited about Stryker’s future under Kevin and believe our shareholders and all stakeholders will benefit from his leadership.”