Expert: CFO's accidental death won't hurt Baidu
Updated: 2008-01-02 10:25
The accidental death of Baidu Inc's Chief Financial Officer Shawn Wang will not have a significant impact on the day-to-day operations of China's largest search engine, experts said.
"Wang's job was more financial related than strategic related and the company's everyday operations are led by other senior managers," said Liu Bin, chief analyst at research firm BDA China. "Although it is a personal tragedy, I don't think Baidu without Wang will be less capable in terms of competing with its competitors."
Wang, who joined Baidu in September 2004 and helped the company list on the NASDAQ the following August, was confirmed dead after an accident on December 27 during his Christmas vacation, Baidu said in a statement on Sunday, without giving details.
The Xinhua News Agency reported on Monday that Wang was killed in a swimming accident when he was on vacation in Sanya, a popular seaside resort on the southern tip of Hainan island.
Baidu said Wang's duties will be assumed by the company's senior managers until a new CFO is appointed.
Baidu's shares fell $5.20, or 1.3 percent, to $393.67 on the NASDAQ on Monday.
Dick Wei, an analyst from JPMorgan, said in a note yesterday that the impact of Wang's sudden death should be limited because Wang had set up a "solid infrastructure for finance, legal and human resources departments".
Wei said that although employee sentiment and investor relations could be impacted in the short term, he remains positive on Baidu because of its dominant position in China's booming online search market.
According to Analysys International, a domestic research firm, China's search engine market turnover reached 825 million yuan in the third quarter of last year, a 98.3 percent jump over the same period the year before.
The rapid growth helped Baidu, which holds 60 percent market share, to surpass Sina.com to become the largest player in China's online advertising market in terms of revenue, according to Analysys.
Baidu said earlier it plans to enter China's C2C market and compete with Alibaba's Taobao.com, and Shawn Wang said before his vacation that the company was considering an initial public offering in China's A-share stock market.
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