Avigilon CEO: At What Point Do You Take the Blame And Resign Yourself?

By: John Honovich, Published on Sep 03, 2015

The shots at Avigilon continue.

After ousting their COO, Avigilon's CEO went on a Canadian financial TV network to defend his decision and the company

The very first question: "At What Point Do You Take the Blame And Resign Yourself?"

In this note, we examine this question and what this means for the company's future.

*** ***** ** ******** continue.

************ ***** ***, ********'* ******* *** ******** ********* ** network ** ****** *** decision *** *** *******

*** **** ***** ********: "At **** ***** ** You **** *** ***** And ****** ********?"

** **** ****, ** examine **** ******** *** what **** ***** *** the *******'* ******.

[***************]

Bad ********

** ** ** ********* bad ******** ** ********** are ****** ************* ** humble ****** ** ****** their *** ******* ********. There ** ** ********** chance ** ******* * meaningful ******, ********* *** someone ** (******) ********* as ********'* ***.

*******, ** ** * powerful ** ********* ** it ****** ****** ******** the ****** (*** ***'* resignation) ** * ********** future *****.

Who's ****?

*** ******* ****** ** that, **** ** *** disprove ** ********'* ***, what ***** ******* *****? Most ** *** ********* team *** **** ****** fired ** **** ** the **** **** ******, so ***** ** ** deep '*****' ** **** a *** *** ****. Having *** ******* / CEO ****** ***** *** Avigilon ** ** **** more *********, ********** ********.

Going ** *** **** ****

***** ****** *** ********** the ***** ******** ** the ******* (*********, **-*********, smart *********) ************** ***** Schmode's ******* *** * good ***** *** **** this ****** **** *** company. ** **** ***, and ***** *** **** of ************, ***** **** definitely ** **** ******** to *** ** ********'* CEO *** ******* **** the ********* **** ** months. ********** ****** **** understand **** **** ******* quarter *** **** *** be **** ******* ** the *****-**** ******* *** that ** **** ****, if ****** *** *****, the ********** ****** *******.

He's ****

** *** ***** ****, Avigilon's *** *** *** out ** ****** ** fire / **** / get '****' / *********. ** is *** ** *** clock *******. ** ******** persist, ** **** ** hard ** ***** ****** else.

Oblivious ** ******

*** **** ********* **** of*** ************ ********'* *** ******* to ***** ** *********** any ********. ****, ** is **** ** ** confident *** **** ***** are *** ******* ********, pretending **** ** *** exist ** ********* ** it ******* *** ****** does *** ********** **** is ***** ** ** is *** ******** ** fix ****.

** ***** *** ********, stock **** **% **** its **** **** ****, growth *******,******* ****, ********** *******, *** they ********* $** ******* ****** their *** *****, **** ** *** the ***** **** ******* ~30% *****.

** *** ******** ****, we ***** **** ** mostly ********'* *** ** stance *** **** ********** he *********** *** ********, at ***** ********.

No *** ***?

*******, ********'* *** ** painting ******* **** * corner **** *** ******** in *** ********* ** him *********** *** *** role ********. ******** *** had * *** ***** 2010 (****** ***** [**** no ****** *********]) **** the ******* *** ~*/**** its ******* ****. ***, the *** ** ***** to *********** ** *** COO *** ** ** approaches **** *********? *** risk **** **** ******* new *********** ******** ** high.

******* ** ** ****** this ** ******** ********* Schmode's ******** / ******** and ** **** **** a *** *** ***** but **** **** ****** be ****** ** ******* mistake ** **** (**** claiming ****** **** ******* ** was ****). ****, ** ******, returns ** *** ***** issue. **** ********* *** analysts ** *** ***** him ******* ** *** failure ** ***** ********.

*******

***********, ******** ******* ** clearly * ******** *** Avigilon's *** **** *** have **** **** ** prove **** ** *** make ****** ******.

*******, ** *** *********** raised, ** ** **** not ******* **** ** next ****, ********'* *** will ** *** **** person ** **** ** 'resign'.

2016 ****** - ****** *****

* **** *** ****** and *** **** **** things *** ********, **** have ****** *****.

*** ***** ***** ** down ******* ~**%:

***** ******** ******* ** the ****, ******* ************ of ******* ****** *** now***** ****** ******** *** net ****** **** ****** the ***** **** *******.

*****, ***** ** ** obvious ****** ***** - analytics **** ******** * minor ******, **** ** terms ** ****** ********* and *** ******* ******, while ********* ****** **** unit ******* *** ********.

*** **** ******* ******* Avigilon's *** ***** ***** / ********* ** *** control ** *** *****, making **** * **** unlikely. *** ****** *** end **** ** ******* Avigilon *** (***** ** think ***** ***** *** would ****** * *********** premium), ********'* ********* *** ***** future ** ***********.

Comments (18)

Which makes me wonder if any of those who left because of Schmode will return?

They should bring back Dave Tynan who was the origional V.P. of Sales and built the foundation at Avigilon before the Schmode coupe. Tynan is a class act that could help calm the waters if Fernandez is willing to admit he needs help. The first step to recovery is admitting you need help...right Alex?

While I agree inprincipal with this, it reminds me of the adage: fool me once shame on you, fool me twice shame on me! I've met Dave and I hope he is smarter than that even if someone like him is exactly what they need!!!

Wow, the interviewer is taunting Avigilon on Twitter:

2:30 in the interview is my favorite:

BNN: You're the CEO, you're the Chairman of the Board, you're also the Founder, could you even be fired if the Board wanted to?

A.F. Well of course; the CEO always reports to the Board. But what you neglected to mention is that I am also the largest share holder by far, bigger than any of the institutional investors out there...

Unfortunately, the question wasn't then reformulated as:

You are now the defacto COO and you're already the CEO, you're the President, you're the Chairman of the Board, you're also the Founder, as well as the biggest Shareholder by far.

Could you even be fired by the Board?

Now that would be a surreal Board meeting for sure!

He wasn't throwing softballs, and Fernandes definitely looked like he wished he'd brought a full set of catchers gear.

Alex gives a hand to former 'valued contributors', during a countdown of the remaining Avigilon executives.

That video of them counting down to Alex's 'new and improved' reign of absolute dictatorship needs a "creepy" button added to the options underneath it. He's absolutely soaking it up, yet looking at their faces I get more an impression that they're all smiling and clapping because they still have their jobs after the carnage of late.

FYI, the video is from February 2012.

That would explain why it creeped me out. That was the countdown to going IPO probably. That would explain why there were all so happy.

Sorry 5. Didn't mean to mislead you.

What I should have said was "how many of these executives are still at Avigilon?"

*excluding board members...

A year has passed and not only have things not improved, they have gotten worse.

The stock price is down another ~20%:

After rallying earlier in the year, further deceleration of revenue growth and now gross margin declines and net losses have driven the stock down further.

Worse, there is no obvious saving grace - analytics have remained a minor factor, both in terms of patent licensing and new product uptake, while Hikvision drives down unit pricing for everyone.

The main defense against Avigilon's CEO being fired / resigning is his control of the board, making such a move unlikely. But unless the end game is selling Avigilon off (which we think makes sense and would garner a significant premium), Avigilon's corporate and stock future is challenging.

Alex Fernandes has lost a lot of investors' money over the past few years, buying an old building (what is the status of that?), paying millions in severance ("consulting fees"), and paying himself and his directors outrageous sums of money. He should be ashamed of himself. How has he delivered value to the majority of Avigilon's shareholders or employees with options/shares?

At what point will the Board step up to their fiduciary responsibilities to shareholders and the company and find a new CEO or take some other corrective action. Or should action be taken against them?

As per many definitions and from www.investorpedia.com: "A board of directors has a fiduciary duty to the company and its shareholders. The board is tasked with overseeing the business' operations and ensuring it generates adequate returns for investors."

Are the majority of investors seeing adequate returns from AVO?? Not likely.


Read more: What are the fiduciary responsibilities of board members? | Investopedia http://www.investopedia.com/articles/investing/111915/what-are-fiduciary-responsibilities-board-members.asp#ixzz4LNsdvTM9

They could depose A.F., but it would be pitched battle for sure, considering Alex and Wan's holdings:

Notice on the list how small the institutional investors are. Related, analysts say that the stock is now primarily in the hands of smaller retail investors (think stockhouse fanbois). Given their very fractured holdings, they do not have the power to force any change.

On the other hand, the price is so low, it is conceivable that an institutional investor tries to buy up a big stake to force Avigilon to make changes / sell off.

As many may know the company was built to be sold...( this came directly from AF himself in the start up days- any higher level employee hired in the first couple years can tell you the same)...possibly he got greedy and missed his window for maximum profits???

possibly he got greedy and missed his window for maximum profits???

Agreed, he missed the window for maximum profits (stock at 9 now vs peak of 34). At this point, it is an issue of how much he can salvage. Strikes me that 15 or 20 is optimistic for a sell off.

Does anyone working at Avigilon own any significant amount of shares? Take a look at these C-Suiters:

Ric Leong CFO < $60k

Mahesh Saptharishi CTO < $40k

Joel Schuster CLO < $50k

Alex Fernandes CEO < $35,000,000

What's up with that?

Source: 4-traders.com

Read this IPVM report for free.

This article is part of IPVM's 6,362 reports, 854 tests and is only available to members. To get a one-time preview of our work, enter your work email to access the full article.

Already a member? Login here | Join now

Related Reports

Disaster At ISC West: Reed And SIA Burn Manufacturers on Mar 16, 2020
ISC West is a disaster but there's a winner for now. Reed and SIA have burned the manufacturers in spectacular fashion. The coup de grâce was...
SIA Director Dismisses Coronavirus, Don't Cancel ISC West on Mar 03, 2020
SIA Director and ISS executive Janet Fenner has come out criticizing the lack of education and the 'mainstream media', arguing against canceling...
Panasonic Favorability Results 2019 on Mar 27, 2019
Panasonic favorability declined, as the company struggled to find its way amidst a changing market and its ill-timed decision to become a Dahua...
Struggling ASCMA / Brinks Home Security Gets Stock Delisting Warning on Jan 08, 2019
Struggling Ascent Capital Group (NASDAQ: ASCMA) has disclosed a warning from NASDAQ that ASCMA faced delisting unless they reverse their downward...
Axis: "No One Wants To Buy A Camera" on Nov 09, 2018
Axis has, in its own description, made a bold declaration: The industry is changing so rapidly that the following statement might seem bold but...
Central Stations Face Off Against NFPA On Fire Monitoring on Sep 18, 2018
Central stations are facing off against the NFPA over what they call anti-competitive language in NFPA 72, the standard [link no longer available]...
Genetec CEO: You Cannot Buy Trust on Feb 14, 2018
Genetec's CEO, Pierre Racz, delivered a direct message at their channel partner conference: Racz has become a focal point in the industry debate...
Motorola Targets Chinese With Avigilon Acquisition on Feb 09, 2018
Motorola joins the growing list of companies taking aim at Chinese manufacturers. Recall, last week it was Hanwha: Chinese Products Damaged...
Convergint Damage Control on Feb 07, 2018
Convergint needs you to understand. When Convergint acquires companies, as they continuously do, it is an acquisition, e.g.: But when...
Avigilon CEO Attacks Asian Companies Cyber Insecurity on Aug 18, 2017
Avigilon CEO is taking aim at their Asian competitors. And he is going directly after these company's cyber security issues. In this note, we...

Most Recent Industry Reports

Access Control Online Show - July 2020 - With 40+ Manufacturers - Register Now on Jul 01, 2020
IPVM is excited to announce our July 2020 Access Control Show. With 40+ companies presenting across 4 days, this is a unique opportunity to hear...
Hanwha Face Mask Detection Tested on Jul 01, 2020
Face mask detection or, more specifically lack-of-face-mask detection, is an expanding offering in the midst of coronavirus. Hanwha in partnership...
UK Government Says Fever Cameras "Unsuitable" on Jul 01, 2020
The UK government's medical device regulator, MHRA, told IPVM that fever-seeking thermal cameras are "unsuitable for this purpose" and recommends...
Camera Course Summer 2020 on Jun 30, 2020
This is the only independent surveillance camera course, based on in-depth product and technology testing. Lots of manufacturer training...
Worst Over But Integrators Still Dealing With Coronavirus Problems (June Statistics) on Jun 30, 2020
While numbers of integrators very impacted by Coronavirus continue to drop, most are still moderately dealing with the pandemic's problems, June...
FLIR Screen-EST Screening Software Tested on Jun 30, 2020
In our FLIR A Series Test, the cameras' biggest drawback was their lack of face detection, requiring manual adjustment when screening each...
Dahua Buenos Aires Bus Screening Violates IEC Standards and Dahua's Own Instructions on Jun 30, 2020
Dahua has promoted Buenos Aires bus deployments as "solutions that facilitate community safety". However, they violate IEC standards and,...
UK Firm Markets False Fever Screening, Hikvision Disavows on Jun 30, 2020
A UK security firm falsely claimed its Hikvision-based thermal solution could be used for "accurately detecting fever in any person", even claiming...
Industry Study: 83% of US Temperature Screening Sellers Falsely Say Not Medical Devices on Jun 29, 2020
83% of US companies selling temperature screening devices, aka 'fever' detectors, claim they are not medical devices, contrary to FDA definition,...
Manufacturers on Virtual 'ISC West' 2020 and Potential ISC West 2021 on Jun 29, 2020
With the 2020 ISC West show now officially canceled, attention turns to Reed's new "ISC West 2020 Virtual Event" planned for October and for the...