Oracle CEO Larry Ellison steps aside, Safra Catz, Mark Hurd appointed co-CEOs

Oracle said yesterday that its co-founder Larry Ellison would relinquish his role as chief executive and become the software giant's executive chairman and chief technology officer.

Jeff Henley,  Oracle's chairman for the last 10 years, was appointed Oracle's v0ice chairman of the board.

The company  also promoted both current co-presidents Safra Catz and Mark Hurd to the position of CEO, Oracle Corporation. All manufacturing, finance, and legal functions will continue to report to Oracle CEO, Safra Catz.

All sales, service and vertical industry global business units will continue to report to Oracle CEO, Mark Hurd. All software and hardware engineering functions will continue to report to Oracle Chairman and CTO, Larry Ellison.

Some analysts see the move as the company's  attempt to induct new leaders to address the huge challenge from rivals who had taken quick strides into cloud computing markets.

According to Oracle director Michael Boskin, Ellison had made it very clear that the wanted to keep working full time and focus his energy on product engineering, technology development and strategy.

He added, Catz and Hurd were exceptional executives who had repeatedly demonstrated their ability to lead, manage and grow the company. He added, the directors were thrilled that the best senior executive team in the industry would continue to move the company forward into a bright future.

Though Ellison co-founder and leader of the company for 37 years stepped aside as chief executive officer yesterday, he and the two new co-CEOs stressed nothing would change under the new management structure, Reuters reported.

However, Oracle shares were down 2 per cent to $40.70 in after-hours trading after it reported the management shake-up and that profit had fallen below Wall Street's average forecast, hurt by weak hardware sales.

The move drew criticism from management experts. Jeffrey Sonnenfeld, a professor at Yale School of Management said, in almost all cases, these co-CEO configurations were a jerry-rigged solution to a political problem.

According to commentators, the move came earlier than expected by many investors, and appeared designed to address concerns about the company's direction under Ellison, 70. Ellison had co-founded the database company that became Oracle in 1977 and has been the company's only CEO.

Reuters quoted Daniel Ives, an analyst at FBR Capital Markets as saying, while there was some speculation Ellison could step down, the timing was a bit of a head scratcher and the Street would have many questions. He added,  investors had a mixed view of Safra and especially Hurd as co-CEOs given the missteps  from the company over the past few years.