FirstGroup Appoints Ex-London Underground Boss As Deputy CEO

9th Jun 2010 10:31

By Jonathan Buck Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Bus and rail operator FirstGroup PLC (FGP.LN) Wednesday announced the appointment of Tim O'Toole, the respected former managing director of London Underground, as chief operating officer and deputy chief executive, lining him up as a possible successor to CEO Moir Lockhead. O'Toole, who has been a non-executive director of the Aberdeen-based company since May 2009, will take up his new role June 14. Lockhead, CEO and deputy chairman since the group's formation in 1995, turned 65 years old in April. "The market is likely to view this as a concrete and positive step towards CEO succession," Arbuthnot Securities analyst Gerald Khoo said in a research note. Khoo said that, as an outsider to the U.K. bus industry, O'Toole can bring a fresh perspective. O'Toole, an American who is in his mid-50s, quit London Underground last year to return to Philadelphia. According to media reports, he resigned due to a shortfall in public funding for the upgrade and expansion of London Underground, which is known as the Tube. He was lauded for his work on the Tube. "He has led from the front and made huge progress in delivering an improved Tube after decades of under investment," Mayor of London Boris Johnson said on O'Toole's departure. "Tim has been a magnificent public servant and we will build on the fantastic legacy he leaves in the years ahead." During his time at London Underground, O'Toole was honored with a CBE, or Commander in the Most Excellent Order of the British Empire, in recognition of London Underground's response to the terrorist attack on July 7, 2005. Prior to joining London Underground in 2003, O'Toole was chief executive of Consolidated Rail Corp., which is a jointly owned subsidiary of U.S. railroad giants Norfolk Southern Corp. (NSC) and CSX Corp. (CSX). He has been a director of CSX since September 2008. O'Toole wasn't available for interviews, a spokeswoman at FirstGroup said. Even though he hasn't yet taken up his new role, O'Toole's remarks in a statement published by FirstGroup disclosed other executive changes at the company. Nicola Shaw, director of bus operations in the U.K., Ireland and Germany, will step down June 30 to pursue other business interests outside the group. She has been at FirstGroup for five years. Her duties will be assumed on an interim basis by Mary Grant, managing director of the group's rail division. At 0910 GMT, FirstGroup's shares were down 2 pence, or 0.5%, at 373 pence, while the FTSE 250 index was up 0.4%. The stock has lost 11% of its value since the start of 2010. -By Jonathan Buck, Dow Jones Newswires; +44 (0)207 842 9237; [email protected] (END) Dow Jones Newswires June 09, 2010 05:31 ET (09:31 GMT)