ITT Corp., signaling a shift in emphasis to its telecommunications manufacturing operations, yesterday named Edmund M. Carpenter its new president and chief operating office.
Carpenter, who had been president of ITT's industry technology subsidiary, will be responsible for all of ITT's worldwide manufacturing operations and related marketing activities, which account for about $11 billion in sales. Carpenter will assume his posts from ITT Chairman R. V. Araskog, who has been chairman, president and chief operating officer since he assumed ITT's chairmanship five years ago.
The appointment of Carpenter, who has broad experience in the manufacturing business, represents a major change in the telecommunications division, which, over the past seven years, has spent some $7 billion in research and development, ITT said. During the past seven years, Araskog directly supervised the development of major ITT products.
With these products now ready to be manufactured and marketed, Carpenter will assume direct responsibility, Araskog said in an interview yesterday.
"There will be a bigger emphasis than there has been in moving the new products into the manufacturing stage . . . more emphasis on meeting production schedules than we had in the past years."
In addition to Carpenter's promotion, ITT announced that DeRoy C. Thomas, president of ITT's Diversified Services Corp. and chairman of The Hartford Fire Insurance Co., and M. Cabell Woodward Jr., ITT's chief financial officer, both were promoted to the post of vice chairman.
The appointments represent "a clear separation between ITT's engineering and manufacturing business and its services business," Araskog said. The services business -- including ITT's insurance operations, its financial services subsidiary, its communications network services and its hotel operations under The Sheraton Corp. -- account for $9 billion of the company's revenue.
Although smaller than the manufacturing division, "it is growing more rapidly, and has a higher level of profitability," Araskog said. "I wouldn't want to pick between the two." Nonetheless, according to Herbert Goodfriend, a financial analyst with Prudential Bache Securities, the reorganization "recognizes ITT's orientation and basic strength in telecommunications and manufacturing."
The reorganization comes about six months after ITT launched a major divestiture campaign, shedding key subsidiaries that do not fit into its telecommunications or services operations. The divestiture campaign began after Minneapolis financier Irwin L. Jacobs indicated he was considering buying the conglomerate and breaking it up and selling parts of it, arguing that the parts were worth more than the price of the stock was at the time.
Since it began its divestiture program, ITT has shed several major operations, including Continental Baking Co. and parts of Eason Oil Co.