Dick Parsons will put off the helm of the world's largest media conglomerate, Time Warner Inc.
Parsons, who is 59, will be replaced on Jan. 1 by the 55-year-old Jeff Bewkes, a former head of HBO who is currently the company's chief operating officer, Time Warner said Monday. Parsons will stay on as chairman.
The CEO changeover had been widely expected. Parsons' contract runs through next May, but Bewkes has been groomed as Parsons' successor for the past several years.
Investors will be looking to the company's third-quarter earnings announcement and conference call on Wednesday for clues about Bewkes' plans for leading the company.
Parsons, one of the most prominent black executives in corporate America, has spent much of his tenure repairing the damage from Time Warner's agreement in 2000 to be acquired by the pioneering Internet company AOL.
The grand synergies promised by the deal never materialized, and the company later faced, and settled, shareholder lawsuits and federal investigations stemming from shady accounting practices at AOL.
Parsons did much to regain the faith of Wall Street, and successfully fended off a challenge from the activist investor Carl Icahn in 2006 to break up the company.
He pared the company's debt and sold off several businesses, including Warner Music Group and a book publishing business, to clarify and streamline the company's structure, which had been criticized as unwieldy.
However investors remain frustrated that the company's stock is still stuck at around the same level as it was five years ago, when Parsons took the helm.
Expectations will now focus on Bewkes, a highly regarded and energetic executive who helped build HBO into a premier media brand, to take action to reinvigorate the stock.
Shortly after the official announcement of Bewkes' appointment, the company's shares were up 21 cents at $18.09.