By Bob Tita
Illinois Tool Works Inc. (ITW) Chairman and Chief Executive
David Speer died Saturday, a month after taking a medical leave
from the diversified industrial company that he had led since
2005.
The company's board announced Sunday that E. Scott Santi will
replace Mr. Speer as CEO and Director Robert Morrison will serve as
chairman. Their appointments take effect immediately. Messrs. Santi
and Morrison were named acting chief executive and acting chairman
in October when Mr. Speer revealed that he would take a medical
leave of absence from the company.
The Glenview, Ill., company did not release a cause of death for
Mr. Speer, 61 years old. But he had been undergoing treatment for
an undisclosed illness for the past year. Mr. Speer had avoided
taking a formal leave from the company until October when the
company said he decided to "fully focus on his health."
"David's remarkable leadership will have a lasting impact on our
company, " Mr. Santi said in a written statement. "I was privileged
to have David as my colleague and mentor for over 30 years and I
will miss him very much."
Mr. Speer was hired by ITW in 1978 for a sales position in the
company's construction products group. He cycled through several
sales and management positions before replacing retiring CEO James
Farrell 2005. The following year the board elected Mr. Speer as
chairman.
ITW's operates about 800 companies focused on industrial sectors
that include auto parts, commercial food equipment, construction
materials, industrial packaging and welding gear. In the years just
prior to the 2008 economic recession, Mr. Speer presided over an
aggressive acquisition program under which ITW averaged about $1
billion a year in additional revenue from acquisitions of dozens of
small companies.
But the acquisitions came to a near-standstill in 2009, exposing
the anemic sales growth from the businesses that ITW already
owned.
In his final year with the company, Mr. Speer abandoned a
decade-old goal of increasing the company's collection of
businesses to more than 1,000.
ITW instead has been trying to accelerate lackluster revenue
growth by focusing on fewer, larger acquisitions, particularly in
faster-growing markets overseas. The company also has been selling
slow-growing businesses, divesting a majority stake in its
laminates business in August to private-equity firm Clayton,
Dubilier & Rice LLC for about $1 billion and selling its paint
finishings business to Graco Inc. in April for $650 million.
Mr. Santi, who has been a frequent fill-in for Mr. Speer at
investor conferences and other events over the past year, is
expected to continue the transformation of ITW's business
portfolio.
Mr. Santi, 51 years old, joined ITW in 1983. He was appointed
executive vice president in 2004 in charge of the company's welding
equipment business and in 2008 was named vice chairman. Mr.
Morrison, 70 years old, has been an ITW director since 2003. He is
a former vice chairman of PepsiCo. and was chairman and CEO of
Quaker Oats Co. prior to its merger with Pepsi.
Write to Bob Tita at robert.tita@dowjones.com
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