XIOtech Hot-Swaps CEO

Hires ex-Ancor chief Ken Hendrickson as chairman and acting CEO as company cuts Seagate ties

March 12, 2003

3 Min Read
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XIOtech Corp. today announced it has hired Ken Hendrickson as chairman and acting CEO -- and with the departure of its previous president and CEO, Kathy Snouffer, XIOtech has cut one of its last remaining ties to former parent company Seagate Technology Inc. (NYSE: STX) (see XIOtech Hires Acting CEO).

Hendrickson was most recently CEO of Ancor Communications, the Fibre Channel switch vendor acquired by QLogic Corp. (Nasdaq: QLGC) in May 2000 (see QLogic to Buy Ancor for $1.7B).

XIOtech has also appointed Steve Snyder as CFO, the same position he previously held at Ancor. XIOtech, which is privately held, is currently conducting a search for a permanent CEO to take the helm.

Snouffer is heading out the door after about a year on the job. She joined the company in February 2002 after spending 13 years in a variety of management roles at Seagate. According to a spokeswoman, Snouffer will remain at XIOtech until March 25, after which she will rejoin Seagate. Snouffer could not be reached for comment (see XIOtech CEO Is in the Family).

With her replacement, the Eden Prairie, Minn., company is trying to further establish itself as an independent entity -- and hoping to get some distance from XIOtech's uneven legacy as a Seagate subsidiary.Seagate bought the SAN storage systems vendor in January 2000, then divested most of its stake in XIOtech as the disk drive maker prepared to go public for a second time in December 2002. That transaction involved investment firm Oak Investment Partners taking a majority stake in XIOtech, the amount of which was undisclosed (see XIOtech Snatches Rash of Cash, Seagate Airs XIOtech Finances, and Seagate Goes Public With a Whimper).

In a statement, Ed Glassmeyer, founding general partner of Oak Investment Partners, said: "XIOtech will benefit from the experience and knowledge that Ken Hendrickson and Steve Snyder bring. It's a strong endorsement of the strength of XIOtech's technology and business strategy to have attracted these two industry leaders."

XIOtech cofounder and ex-CEO Phil Soran, who is now CEO of stealth software startup Compellent Technologies Inc., says Hendrickson is a good catch for the company. "He is a strong leader, and I am happy for him and XIOtech," Soran says.

The company's new management team definitely has its work cut out, and job one will most likely be further revamping XIOtech's cost structure. For the fiscal year ended June 28, 2002, XIOtech's revenue was $74 million and its net loss was $51 million, according to Seagate's IPO filing in December. For the quarter ended Sept. 27, 2002, XIOtech narrowed its losses, with $20 million in revenues and a $6 million net loss.

Prior to serving as Ancor's CEO, Hendrickson was executive VP and general manager of Western Digital Corp.'s (NYSE: WDC) microcomputer products division. He was also head of the large disk division of Control Data Corp. (since acquired by Syntegra, the consulting and systems integration arm of British Telecommunications plc (BT) [NYSE: BTY; London: BTA]). Before that, he spent 18 years at IBM Corp. (NYSE: IBM). Hendrickson currently serves on the board of directors of contract manufacturing company Pemstar Inc. (Nasdaq: PMTR).Snyder, meanwhile, was CFO of Cray Inc. (Nasdaq: CRAY) and also worked with Hendrickson at Control Data.

Todd Spangler, US Editor, Byte and Switch

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