Endurance seeking new CEO as SEC probe lingers
Endurance International Group Holdings Inc., a website hosting and e-mail marketing company whose financial reporting is under federal investigation, said its chief executive is stepping down.
The Burlington company said on Monday that CEO Hari Ravichandran will continue in the job until the board hires a successor. In a statement, Endurance cited efforts to generate more cash and a Securities and Exchange Commission investigation for the decision to accelerate plans for Ravichandran to give up his post.
“My number one priority has always been to do what is best for Endurance, our employees and our shareholders, and I am pleased that the board and I are aligned on the qualities our next CEO needs,” Ravichandran, who founded the company 20 years ago, said in the statement.
Endurance, which completed an initial public offering in 2013, owns a portfolio of brands that help customers operate websites, including Bluehost, HostGator, and SiteBuilder.
In early 2016, it completed the $1.1 billion acquisition of Constant Contact, a Waltham company that sells e-mail marketing services. Constant Contact shed more than 200 jobs shortly after the acquisition was finished.
In late 2015, shortly after it announced plans to acquire Constant Contact, the two companies disclosed that the SEC ordered them to produce documents relating to their financial reports and their sales and marketing practices.
In its most recent annual report, Endurance said it was cooperating with the SEC investigation, which was launched by the SEC’s Boston office. Endurance said it couldn’t predict how the probe might affect its business.
Endurance has increased its revenue and narrowed its losses in recent years, but remains unprofitable. The company reported a net loss of about $139 million on $292 million in sales in 2012, and a loss of about $81 million on revenue of $1.1 billion last year.
The company said that its board believes “finding a CEO with a breadth of experience growing complex organizations will enable Endurance to reach its next set of milestones.”
Endurance shares were up more than 4 percent to $7.15 in after-hours trading Monday on news of the CEO search and confirmation of the company’s financial guidance for 2017, including a 4 to 5 percent increase in revenue.
The company’s stock reached a high of $22.80 per share in April 2015, but its price has declined steadily since then.