Why iGATE Shares Got Crushed

Before you go, we thought you'd like these...
Before you go close icon

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of iGATE have gotten crushed today -- down by 13% at the low -- after the company abruptly fired its CEO.

So what: The company terminated CEO Phaneesh Murthy, effective immediately, due to an undisclosed relationship with a subordinate employee that included sexual harassment allegations. The ongoing investigation concluded that Murthy failed to disclose the relationship, a violation of company policy. The investigation did not find any violation of iGATE's harassment policy.

Now what: Co-founder and Co-Chairman Sunil Wadhwani said the board "deliberated extensively" about the decision, since Murthy has contributed greatly to the company over the past 10 years. iGATE reiterated that Murthy's departure is unrelated to the company's operational or financial performance. Gerhard Watzinger has been appointed as interim CEO until a permanent CEO is found (Watzinger is not interested in assuming the role permanently).

Interested in more info on iGATE? Add it to your watchlist by clicking here.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.

The article Why iGATE Shares Got Crushed originally appeared on Fool.com.

Fool contributor Evan Niu, CFA, has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

People are Reading