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CEVA Logistics, the freight forwarder currently in the financial spotlight, is in the midst of a management reshuffle as it attempts to turn around the business.

Head of Asia Pacific, Didier Chenneveau left the company on July 10, while Matt Ryan, president Americas, is set to go at the end of August.

The moves mark a significant shift in the management team since former CEO John Pattulo stepped down in October to be replaced by Apollo stalwart and CEVA chairman, Marvin Schlanger. Other casualties since Mr Schlanger took over include Bruno Sidler, former COO, who joined DKSH in February this year.

Mr Chenneveau and Mr Ryan will be replaced on an interim basis, by Peter Dew, CIO, and Mr Schlanger, who will take on the Americas role.

The reasons for the moves are unclear, but it is thought that Mr Schlanger has been keen to implement change at the company. One analyst, however, has questioned the ability of Mr Schlanger, who has little freight experience, to manage the increasing roles he appears to have taken on. As CEO, chairman of the board and interim president of the Americas – as well as having roles at several other companies – he is undoubtedly busy.

“He’s a good businessman, but Marvin is not a traditional career logistics and transport guy – and that matters,” said the analyst.

Dick Armstrong, chairman of Armstong & Associates, added: “Marv is personable, but I think he’s going to have a challenge holding on to the talent. Good people there won’t pass up opportunities, given the situation. The customers will get taken care of, but there will be an ongoing problem with personnel.”

While Mr Chenneveau left the company relatively quickly, it would appear that Mr Ryan will leave under his own terms. But the changes reflect concerns that market observers have had about the company that has faced a difficult financial situation in the past year.

CEVA has been labouring under large amounts of debt and a consequent lack of liquidity, following its takeover by private equity company Apollo Global Management in 2006 and subsequent merger with EGL. In May, it completed a recapitalisation that reduced its net debt by some €1.3bn.

Apollo is thought to be keen to exit the business, but earlier this year CEVA was forced to pull an intended IPO on the New York Stock Exchange (NYSE) in favour of the recapitalisation. The NYSE is still part of the company’s strategic plan, it said in May.

One analyst with a close knowledge of the company suggested that the management shuffles were part of a longer game connected with such a sale. “It is being suggested that the management is being cleared in order to make a sale, and thus make the insertion of a new management easier,” he told The Loadstar.

In encouraging news for CEVA, this week Moody’s Investors Service upgraded CEVA Group from Caa3 to Caa1, and its probability of default rating to Caa1-PD from Ca-PD, reflecting some improvement in its liquidity, which the agency says “is sufficient to address operating requirements over the intermediate term”.

It warned, however: “The rating is also impacted by our concerns regarding the sustainability of the company’s capital structure, despite the recent restructuring, given the high cost of servicing the group’s debt and the recurring negative free cash flow.”

Whether the ratings upgrade is sufficient to put a line under further market speculation about CEVA’s finances, only time will tell.

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