Davidson Founders Make Quiet Exit
Just three months ago, Bob Davidson was heaping high praise on CUC International, the Stamford, Conn.-based technology consumer services company that agreed to purchase his educational software business for $1.5 billion nearly a year ago.
“We’re happy campers,” said Davidson, who founded Davidson & Associates in 1984 with his wife, Jan, a onetime English teacher. CUC, he said in November, recognized “that we knew what we were doing, and they supported us in the marketing and sales area,” and thus would be nothing less than an excellent parent for Glendale-based Knowledge Adventure, which it acquired Feb. 3.
So it came as something of a surprise to hear that the Davidsons stepped down from their day-to-day responsibilities with CUC’s Torrance-based software unit, which was built around Davidson & Associates.
Late last month, CUC quietly announced that Bob would step down as chief executive of CUC Software and that Jan would give up her position as president of Davidson & Associates in order to “pursue other interests.” The couple will remain on CUC’s board of directors.
Christopher McLeod, a CUC executive vice president, has taken over at CUC Software, which also includes Knowledge Adventure, Blizzard Entertainment and Sierra On-Line.
A spokeswoman for CUC in Connecticut said the Davidsons’ departure was a mutual decision.
“It became obvious to everybody that this was the right time to do this,” said Laura Hamilton. She said the Davidsons, both 52, were not available to shed light on the situation, and attempts to reach them independently were unsuccessful. Other CUC executives were said to be too busy to comment.
Also tight-lipped were the chiefs of CUC Software’s divisions.
“We’ve been instructed pretty closely not to make any comments,” said Allen Adham, president and founder of Blizzard Entertainment in Irvine.
Some analysts said they are surprised and confused by the musical chairs at Davidson, which is known for its popular “Blaster” series of educational programs.
“It really doesn’t make sense to me,” said Seth Feinstein, a partner with Crowell, Weedon & Co. in Los Angeles. “Bob and Jan are huge assets, and I don’t think there is anyone who could run Davidson better than the Davidsons.”
But other analysts said CUC handled the Davidsons the way it often deals with founders of companies it acquires: It keeps the founders in place for a transitional period while it grooms its own people to replace them, and once key personnel--such as software developers--are secured, the switch is made.
And the Davidsons--who made it onto Forbes’ list of the 400 richest Americans with a net worth of $475 million--might want to concentrate on philanthropic efforts. Some of the money they made by cashing in half of their CUC stock was put in charitable trusts, and the couple donated $1 million in computer software to Los Angeles County schools last year.
As Karen Ficker, an analyst with Furman Selz in New York, said, “They have a substantial amount of funds now and there’s not the same incentive to work day to day.”
