SUNRISE MEDICAL: Founder Resigns, Company to Reorganize
Citing the need for leadership focused in cost control, Sunrise Medical Inc. founder Richard Chandler resigned as chief executive yesterday. Chandler, who founded the Carlsbad-based company in 1983, relinquished his seat on the board of directors, but remains the firm's largest independent shareholder, with a 10% stake (Freeman, San Diego Union-Tribune, 10/6). Sunrise, the world's second-largest producer of medical equipment for disabled people, has just completed a four-year reorganization plan, trimming costs and 600 jobs. In addition, the firm renegotiated lending agreements, led by Bank of America. The new agreements reduce Sunrise's line of credit from $120 million to $65 million over the next nine months (Wall Street Journal, 10/6). The firm named longtime company director Murray Hutchison as interim CEO and hired Deutsche Banc Alex Brown as financial advisor. Operating manufacturing plants in 19 countries, including a Tijuana factory, Sunrise employs more than 4,500 workers -- 40 of which work in its Carlsbad headquarters -- and is considering a possible stock offering as a means to generate cash (Union-Tribune, 10/6). The company's stock has fallen 46% this year, but jumped 50 cents to $6.75 yesterday on news of the reorganization (Bloomberg/Los Angelest Times, 10/6).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.