Morgan Stanley's former chairman and former president reiterated a call for the ouster of current CEO Philip Purcell, stating that a management shakeup announced earlier in the day was not in the best interests of the company.
Purcell said he was replacing company president Stephan Newhouse with two co-presidents, Morgan Stanley veterans Stephen Crawford and Zoe Cruz. The move, according to a Morgan Stanley statement, would provide new oversight of the company's institutional securities and investment management operations.
However, a group of former executives and major shareholders, led by former chairman Parker Gilbert and former president Robert Scott, said on Tuesday that the restructuring could result in the loss of other executives.
The group also released a letter, dated March 3, sent to the current Morgan Stanley board calling for Purcell's departure. The group blamed Purcell for the company's lagging stock price and financial performance.
"We believe that the overriding cause of the firm's poor performance is a failure of leadership by Philip Purcell as the firm's CEO," the March 3 letter said.
In the statement announcing the management changes, Purcell said that Crawford and Cruz would have responsibility for institutional securities as well as individual investor and investment management groups.
He emphasized that the goal was improving performance.
"By combining our institutional, individual and investment management businesses under Steve and Zoe's leadership, we are continuing the great investment banking traditions of Morgan Stanley and creating a securities firm without peer," Purcell said in a statement. "The appointment of a new generation of leaders for our integrated securities businesses reaffirms our commitment to building long-lasting shareholder value."
The former executives, however, said that the restructuring "was not responsive" to their concerns.
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