The president and CEO of Aaron's, a rent-to-own furniture company in Atlanta, has resigned.
Robert C. Loudermilk, the son of the company's founder, announced his resignation Friday afternoon. In a statement, the company said Loudermilk was leaving due to health reasons. He also resigned from Aaron's board of directors.
Ronald W. Allen, former chairman and CEO of Delta Air Lines, will serve as Aaron's interim president and CEO. Allen, who has been a member of Aaron's board since 1997, said he learned about his new post about 2 p.m. Friday.
"I don't know all the challenges," Allen said. "I'm going to be on the job Monday morning."
Allen, who led Delta from 1987 to 1997, said he is enthusiastic about the company, and has confidence in its future. Aaron's has a market capitalization of $2 billion, and earned $28 million in the third quarter.
The company, which has more than 1,900 stores in 48 states and Canada, is unlikely to suffer from Loudermilk's exit, said Rob Straus, a senior analyst with Gilford Securities. He said the Aaron's bench is deep, and the company has a strong track record of creating shareholder value.
Still, he said the announcement was unexpected.
"The real challenge is to install someone in the CEO position that has the aptitude to be as successful as the family executives have been over the past decade," he said. "I think Robin was a strong asset to the firm."
Loudermilk, 52, became president of the company in 1997 and its CEO in 2008. He joined the board in 1983.
Succession planning is becoming increasingly important for the boards of publicly traded companies, said Joel Koblentz, a senior partner with headhunting firm The Koblentz Group, an Atlanta-based executive search firm.
Over the past few years, several publicly traded firms, such as food products company Sara Lee and Columbus-based banking company Synovus Financial, have had chief executives take leave because of serious medical concerns, he said.
Loudermilk has always had some health issues, said Aaron's executive vice president and chief financial officer Gilbert L. Danielson. He said the job of the CEO is stressful, and Loudermilk's first love has always been the real estate business. Loudermilk plans to concentrate on his health and family real estate interests, the company said.
Loudermilk's father, R. Charles Loudermilk, Sr., remains chairman of the board after founding the company in 1955. Allen said he expects to work with him closely as he continues to learn his new role.
A search for a permanent CEO will be held, but Allen said the details had not yet been set.
Staff writer Scott Trubey contributed to this article.
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