NZX CEO Mark Weldon to step down next year after almost a decade; no mention of his next role or a successor. Your view?

The NZX has announced that Chief Executive Mark Weldon will step down during the first half of 2012.

It made no mention of his likely next role or a successor.

“Mark has effectively been founder, as well as leader, of NZX, as we now know it, since 2002. Under his stewardship, NZX has grown from a small and threatened mutual exchange to a thriving information, markets and infrastructure business, with a range of integrated business lines, a healthy balance sheet and a valuable set of options for future growth,” said NZX Chairman Andrew Harmos.

“Following the successful execution of NZX’s second five-year strategic plan, Mark has indicated that the time is now right for him to leave the company. The Board respects his decision. We have been privileged to have someone with that amount of talent, energy and commitment as the driving force behind NZX’s first critical decade," Harmos said.

“NZX is in extremely good heart, with the Derivatives Market growing exponentially over the past 12 months, the Clearing House, Agri Information and Energy businesses functioning very strongly and, for the first time, the macro settings for savings, tax and investment equally strong, providing a welcome tailwind,” said Harmos.

The NZX had grown from revenues of NZ$10.4 million, a loss of NZ$500,000, no dividends and a valuation of NZ$15 million in 2002 to its current position of an operating profit approaching NZ$30 million, dividends in 2011 of NZ$17.24 million and a market value NZ$288 million. Harmos said the NZX had generated a total return to shareholders of 535%, or 24% per annum since its listing in 2002.

“Given the strength of the organisation and the wind that is now at our backs, I believe this is very close to an optimal time for both the individual and the organisation,” said Harmos.

Weldon said it had been a tough decision to leave, but now was the right time.

"The organisation is in such good shape, with momentum building that will provide a positive working environment for the next CEO,” Weldon said.

There was no comment on what Weldon would do with his 5% shareholding in NZX. Weldon sold 2.5 million shares for NZ$5.9 million in late June this year, reducing his stake from 6.63% to 4.98%. See the substantial shareholder notice here.

Last year's annual report listed Weldon as the NZX's fourth biggest shareholder at 6.6% behind ANZ at 8.6%, Fisher Funds on 7.9% and ACC on 7.0%.

Weldon received a salary of NZ$1.3 million last year.

'Mixed verdict'
 

Commentators, however, have given a mixed verdict on the NZX market itself, rather than the company that ran and regulated the market.

Goldman Sachs strategist Bernard Doyle wrote a research note last year that the value of the NZX had almost halved since 1997 relative to GDP, while Australia's had more than doubled. See more here in Gareth Vaughan's article

Doyle later said in a Double Shot interview that the NZX was "in god's waiting room". See the Double Shot here.

Milford Asset Management executive director Brian Gaynor last year said the market was the quietest he'd seen it in 35 years and desperately needed new listings. See his Double Shot interview here with Gareth Vaughan.