Best Buy CEO to step down
Schulze, who founded electronics chain, remains chairman; Anderson new CEO.
February 25, 2002: 2:02 p.m. ET
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NEW YORK (CNN/Money) - Best Buy Inc. founder and CEO Richard Schulze is stepping aside and Bradbury Anderson, the company's vice chairman and president, is being promoted to the top job effective June 30, the nation's largest consumer electronics retailer said Monday.
Additionally, Best Buy (BBY: Research, Estimates) is promoting Allen Lenzmeier to president and chief operating officer, and Michael Keskey to president of Best Buy stores, effective March 3.
Schulze, 61, who will remain chairman, said he plans to focus more on "personal interests."
A company spokeswoman said Monday that Schulze's decision to step down is part of a planned succession in place for a number of years. In 1999, Schulze told the board that he wanted to retire between his 60th and 62nd birthdays, and has been grooming Anderson for the top job since then.
Best Buy's stock climbed $1.74 to $69.35 in New York Stock Exchange trading Monday.
Sanford C. Bernstein analyst Colin McGranahan said the transition was not unexpected, considering that Schulze is leaving at the top of his game, and that he is also coping with the loss of his wife, who died last year.
"He probably wants to crank it back a notch," McGranahan said, adding that the transition should be neutral to investors.
"It was a nice succession in that you've got experienced, long-tenured Best Buy people basically just moving up in lock-step progression," he said.
Schulze's resignation comes as the chain he founded in 1966 is in the midst of an aggressive expansion and is benefiting from a surge in industry demand for innovative, reasonably priced consumer electronics.
Consumer electronics were among the best-performing retail categories during what many retail watchers have called one of the most dismal holiday seasons in the last decade.
The company reported a 6.2 percent increase in January sales at stores open at least a year, a key gauge known as same-store sales, compared with the same period a year earlier.
At the beginning of the holiday rush, Best Buy logged a 1.6 percent increase in November same-store sales, below what many analysts expected, yet better than the 3 percent decline for the entire sector.
Helping to drive sales has been a new cycle of innovation, particularly in DVD, digital television and other digital components, combined with a renewed focus on the home since the Sept. 11 terrorist attacks, analysts have said.
Those trends have also benefited the company's main rival, Circuit City Stores Inc. But that chain is facing its own difficulties.
Circuit City has been struggling since it exited the appliance business about a year ago. On Friday, the company lowered earnings expectations for the next two years, citing costs associated with store remodeling and relocations. Additionally, Circuit City said it would spin off its CarMax auto store business into a separate publicly traded company.
Anderson, 52, joined the Eden Prairie, Minn.-based chain in 1973 as a sales representative and store manager and was promoted to vice president in 1981. He became executive vice president in 1986 when he also was elected to the board of directors. He became president and chief operating officer in 1991 and vice chairman in 2001.
"Brad's insights have been invaluable to me over the past 29 years. He has proven that he has both the vision and the leadership to propel the company forward into a new decade of growth," Schulze said.
Lenzmeier, 58, is the former president of Best Buy stores. As the company's new president and chief operating officer, he will assume responsibility for all of the company's brands, including Future Shop in Canada, Magnolia Hi-Fi, Media Play, ON Cue, Sam Goody and Suncoast. He joined Best Buy in 1984 as vice president of finance and operations, becoming senior vice president in 1986 and executive vice president and chief financial officer in 1991.
He was named president of Best Buy stores in 2001 when he also joined the board.
Keskey, 47, previously served as vice president of retail sales at Best Buy stores. In his new role as president of the group, Keskey will oversee plans for the company's expansion. He joined Best Buy in 1989 as a store manager, eventually being promoted to vice president in 1996. He was named senior vice president a year later and executive vice president in 2001. 
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