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AT&T hires unknown
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October 23, 1996: 9:05 p.m. ET
Company names printing executive Walter to succeed Allen as CEO
From Correspondent Steve Young
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NEW YORK (CNNfn) - AT&T made calls outside the company to find its successor to Chairman Robert Allen, and John Walter, head of the printing and publishing firm R.R Donnelly, answered.
AT&T announced Wednesday that it had named Walter president and chief operating officer, and the company made it clear that Walter will replace Allen, who plans to step down in 1998. The choice ended some anxious speculation in the industry.
Analysts weren't surprised that AT&T went outside to find Walter, but they were shocked to learn he had no telecommunications experience. Even AT&T admitted Walter was not a likely choice.
"He has no long history in the telecommunications world," said AT&T Chairman and CEO Allen. "The company he left, while large in its own right, by AT&T standards is relatively small. And yet I and the AT&T board are convinced he's the right person for the job."
According to the company's search committee, Walter won the job because of his success guiding R.R. Donnelly from an old, on-line printer into a high-tech digital company.
Today, Donnelley is the largest supplier of commercial printing and related services in the United States. The company prints magazines, encyclopedias and yellow pages for 35 telephone directory publishers worldwide.
"You have here an individual who for the last several years has led the transformation of his business and his industry," said Harold Burlingame, AT&T's senior vice president of human resources.
Walter is filling the vacancy created by Alex Mandl, who abruptly resigned in August to run a smaller telecommunications company. Walter said he was confident he could handle the challenges that await him.
"I have very few illusions," he said. "This is not going to be any walk in the park. Investors are impatient. They have a right to be." But Walter added that AT&T is impatient to succeed as well.
Wall Street, though, was less than excited. Shares in the company fell 1-7/8 to 37-7/8.
But Robert Wilkes, telecommunications analyst for Brown Brothers & Harriman, said lower expectations may actually help Walter. (170K WAV) or (170K AIF)
Walter's appointment takes effect November 1. 
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