STH has benefitted significantly from Mr Clontz's leadership but his retirement is not a particular surprise. After being with STH for more than ten years, his departure was not a matter of "if", but "when". In fact, we had often thought that Mr Clontz might have left earlier but believe the Jul 08 departure of Mike Reynolds (the previous President) complicated the succession plan. After his departure, however, STH will have a new CEO and (a relatively new) COO.
But while Mr Clontz's retirement is not particularly surprising, the appointment of Mr Neil Montefiore is interesting in several respects. Mr Montefiore comes with substantial experience of the Singapore telco market having been CEO of M1 for more than 12 years (which he left rather abruptly earlier this year) and is considered to be one of the leading strategic thinkers in Asian telcos (at least in our opinion). He had for example plans to develop M1 into a fully integrated operator across fixed and mobile but was unable to achieve his vision there. As such, his appointment as STH's CEO now offers him the platform to develop this objective / vision and we look forward to watching STH's development under his leadership.
We expect Mr Clontz to oversee STH's bid for the English Premier League rights which is the key 2H09 event. Despite the management change and the EPL auction, given upside to our valuation and the sustainable and attractive yield, we maintain Buy.
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