By Kimberley Kao


Techtronic Industries shares fell sharply after the abrupt resignation of its high-flying chief executive, Joseph Galli Jr., who was widely acknowledged for driving the company's growth and solid financial performance.

Shares of the power-tools maker, which owns brands including Milwaukee, Empire, Homelite and Hart, ended 5.0% lower at 102.60 Hong Kong dollars on Tuesday after falling as much as 8.6% earlier.

Techtronic said Monday that Galli resigned as CEO and executive director, effective immediately, due to his decision to retire. Galli confirmed he has no disagreements with the board and the group, it said.

"His departure would cause a drag on the share price in [the] near term," driven by sentiment rather than fundamentals, Citigroup analyst Eric Lau said in a research note.

In 2008, when Galli became CEO, Techtronic posted sales of HK$26.615 billion (US$3.41 billion). Last year, it recorded US$13.73 billion in sales.

"I feel like this is the perfect time for me to move on, the business is flourishing and the team is outstanding," Galli said. He joined Techtronic in 2006 through an old friend, Horst Pudwill, co-founder and chairman of the company.

On Monday, Techtronic named Steven Richman, another company veteran, as the new CEO.

Richman served as president of the flagship Milwaukee business for 17 years, during which time the unit experienced double-digit compounded annual revenue growth over the past decade, Techtronic said.

Citi analyst Lau said he expects the company's strategy to be maintained under the new leader.

"So if the stock corrects on this news flow, we deem it as a good buying opportunity [for the long term]," he said.


Write to Kimberley Kao at kimberley.kao@wsj.com


(END) Dow Jones Newswires

05-21-24 0439ET