FedEx (FDX) said that company founder and long-time chief executive officer (CEO) Fred Smith will step down on June 1 and be succeeded by the company’s current president and chief operating officer (COO) Raj Subramaniam.
Going forward, Subramaniam will serve as both CEO and president of FedEx and Smith will become executive chairman, the package-delivery company said in a news release.
Smith, age 77, started Federal Express in 1973, delivering small parcels and documents more quickly than the U.S. post office. Over the next half-century, Smith oversaw the growth of a company that combined air and ground service and became something of an economic bellwether because of its service to other companies.
FedEx began operations with 14 planes and 389 team members, who delivered 186 packages on the first day of operations.
Subramaniam, age 56, joined FedEx in 1991 and served in several marketing and management jobs in Asia and the U.S. He rose to become the chief marketing and communications officer, and also served as the top executive of FedEx Express. He became president and chief operating officer in 2019 and joined the FedEx board of directors the following year.
Smith said that for the past several years he had recommended to FedEx directors that if he died or became disabled, they should name Subramaniam CEO and appoint an independent chairman. On Monday, the board appointed a current director, Brad Martin, as vice chairman and Smith’s designated successor as board chairman.
The company earned $5.2 billion U.S. on revenue of $84 billion U.S. in its most recent full fiscal year, which ended last May 31.
Smith owns more than 19.2 million shares of FedEx, according to data from FactSet. They are worth more than $4.4 billion U.S. as of yesterday’s closing price (March 28). Year to date, FedEx stock is down 11% at $230 U.S. per share.
