named David Lesar, the company's president and chief operating officer, to succeed Dick Cheney, who stepped down as chairman and chief executive Tuesday to serve as
Gov. George W. Bush's Republican
running mate in the presidential election.
Cheney, a former Defense Secretary who emerged as Bush's likely vice presidential running mate in recent days, had served as head of the world's largest provider of oil field services for about five years. On May 31, he fueled speculation over potential political plans when he exercised his Halliburton options for the first time -- selling nearly half his interest in the company. Cheney sold 100,000 shares, raising an estimated $5.1 million. Before the sale, Cheney held options on 229,000 shares.
On the same day, Lesar cashed in 15,000 shares, or just under 8% of his holdings, for an estimated $765,000. Lesar, 46, still holds options on about 168,000 shares. He was widely considered the leading candidate to succeed Cheney.
"I don't think it will be much of a change for the company," said Jim Wicklund, an oil industry analyst at
Dain Rauscher Wessels
, of Lesar's promotion. "He's considered very capable. It will be a positive move."
Indeed, after the announcement, shares of Dallas-based Halliburton rose 9/16, or 1%, to close at 42 3/6 Tuesday. The stock had traded as high as 43 7/16 earlier in the day as news reports spread of Cheney's likely departure for the political arena.
As Halliburton's chief executive, the 59-year-old Cheney collected $1.92 million last year plus stock options. He would earn less than 10% of his former salary should he be elected to the vice presidency this fall. Lesar received an estimated $1.2 million last year plus stock options.
Dain Rauscher Wessels is maintaining its neutral rating on Halliburton's stock, with a long-term target price of $60. The investment firm does not underwrite the stock.
Allen Brooks, an analyst at
CIBC World Markets
, agreed that Cheney's departure should not have any negative effect on the company's stock, or its outlook. Brooks maintains a buy rating on the stock, with a $56 target price. CIBC does not underwrite the stock.