The Market Capitalization of VMWare Drops by 25% due to the Exit of the CEO

The virtualization  company,  VMware Inc. (NYSE: VMW) has made an announcement of a significant management change this morning.  Diane Greene is departing as the company’s President and CEO.

VMware’s Board of Directors has appointed Paul Maritz as President and CEO of VMware effective immediately. Maritz was also named to VMware’s Board of Directors.

Greene is one of VMware’s founders.  Maritz is a former Microsoft employee noted as one of the builders of their Windows franchise, and he founded cloud-based solutions company Pi Corporation in 2003.  Pi was acquired by EMC in February 2008.

VMware’s stock fell as much as 30 percent during Tuesday trading due to initial reaction and closed at $40.19, a drop of $13 or 24.44 percent. The company also said that while it won’t update second-quarter guidance, “we expect revenues for the full year of 2008 will be modestly below the previous guidance of 50 percent growth over 2007.”

Source: 24/7 Wall St

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