According to The Wall Street Journal, the chief executive officer of Starwood Hotels & Resorts Worldwide has abruptly announced on Tuesday that he is resigning. The CEO has recently been criticized for butting heads with shareholders after he has failed to increase the value of shareholders.
Frits van Paasschen, whose 53 years old, has been CEO since 2007. However, Mr. van Paasschen has also been greatly criticized for his failure to grow the Starwood brand through franchise or management agreements at the pace desired by board members.
The chairman of the board, Bruce Duncan, described Mr. van Paasschen’s resignation as a “mutual agreement” and said that Adam Aron, who has been Starwood director since 2007, has been named the interim CEO.
Since the announcement of Mr. van Paasschen’s was reported, Starwood shares rose 2.7% to $80.64.
Starwood shares rose 2.7% to $80.64 on Tuesday after the company announced the CEO change. Mr. van Paasschen couldn’t be reached for comment.
Mr. Duncan blamed Mr. van Paasschen’s failure on his lack of industry knowledge. Mr. van Paaschen is a marketing mogul but lacks in-depth knowledge within the hotel industry.
A permanent CEO will be selected by several board members and vetted by an executive recruitment firm.