Wyndham's Kleisner: No Surprises With Restructuring Shakeout

Theodore Teng, Wyndham's president and COO, is stepping down after four years. Fred J. Kleisner, chairman and CEO, will assume Teng's duties. Also leaving is Joseph Champ, executive vice president of business development and chief investment officer for the last three years. His successor is Judy Hendrick, former senior vice president and treasurer, who becomes EVP and chief investment officer. The human resources' duties of Patricia Smith, HR executive vice president since 2000, will be transferred to Mark Solls, general counsel, while Donna DeBerry, a five-year EVP for diversity programs and corporate affairs, has been retained as a Wyndham consultant, the first client for her new business. Related to the shuffle, Timothy L. Fielding, former senior vice president and corporate controller, will be become an EVP and chief accounting officer and Michael Higa will be named corporate treasurer.

Unrelated to the four cuts is the Oct. 29 exit by Richard A. Smith, Wyndham's EVP and CFO since 1999. He will be replaced by Elizabeth Schroeder, now the hotelier's senior vice president of finance, strategic planning and investor relations.

"Today's events are reflective of our strategic plan, which we announced in 1999," Kleisner explains to GlobeSt.com. The wave of changes is the second largest shuffle in the hotelier's history, both under Kleisner's watch. At its peak, Wyndham had a corporate staff of 1,200 in 10 headquarters offices, which was scaled back to just Dallas and a smaller team to lower corporate costs to $50 million from $112.5 million in Kleisner's first three months.

Kleisner says the executives will transition out of the company by year's end. All, he stresses, were part of the decision-making processes since 1999 to lead up to today's action. "There were no surprises," he says. "Anyone who's departing will depart with good feelings for the company and we'll have good feelings for them."

Kleisner, who addressed the rank-and-file this morning, says several departments will be consolidated as well. The company now has roughly 500 employees "and will stay in the 500 range," he says. He declined to go into detail during the interview, but more is sure to surface during Wyndham's third-quarter earnings call set for Nov. 9 at 10 a.m. Central, at which time he also will declare the restructuring costs, including severance. "The number was not important," Kleisner says. "What was important was that I adjust the infrastructure to the business....It is the right thing for us to be doing."

Kleisner says the move sets up Wyndham for the long term as the hospitality industry heads into what is predicted to be a stellar 2005. "Wyndham is positioned to participate," he stresses, adding the last of its non-core assets will be under contract before the calendar flips and closings will come in first quarter 2005.

Kleisner says the end result will speak for itself. "Over time the trading of our stock will reflect that today I have added significant value to the company by restructuring our headquarters," he says. "Time will tell that I've done the right thing, that there is no reason for people to bail."

As for analysts, Kleisner says "all will have opinions. Some will think it's a brilliant move. Some will think I should have done it six months ago and some will say negative things." He says his focus is the plan at hand and not worry about analysts' opinions. "Now, the company is at the right size," he says. "The best way to use my energy is to motivate the people and do the best job that I can to run the company."