NEW YORK -- Microsoft has narrowed its list of external candidates to replace Chief Executive Officer Steve Ballmer to about five people, including Ford Motor chief Alan Mulally and former Nokia CEO Stephen Elop, according to sources familiar with the matter.
The world's largest software maker also has at least three internal candidates on its shortlist, including former Skype CEO Tony Bates, who is now responsible for Microsoft's business development, and Satya Nadella, the company's cloud and enterprise chief, the sources said.
Despite the narrower list -- the company started with about 40 names -- the process could take a few more months, the sources said. In August, Ballmer said he would retire within 12 months.
The names of other candidates couldn't be learned, but the search committee is interviewing executives from a wide range of sectors, including life sciences and consumer, the sources said.
Microsoft (MSFT) declined to comment on the process and on behalf of the internal candidates. A Nokia (NOK) representatives couldn't be reached immediately for comment late Tuesday.
Ford (F) spokesman Jay Cooney said: "There is no change from what we announced last November. Alan remains fully focused on continuing to make progress on our One Ford plan. We do not engage in speculation."
Investors have pushed Microsoft's board in recent months to look for a turnaround expert, such as Mulally or Computer Sciences (CSC) CEO Mike Lawrie, to succeed Ballmer. %VIRTUAL-article-sponsoredlinks%Some investors have also suggested to the board that co-founder Bill Gates should step down from his role as chairman, saying he stands in the way of radical reform at Microsoft.
Microsoft remains highly profitable and last month beat Wall Street's quarterly profit and revenue forecasts. But it has lost ground to Apple (AAPL) and Google (GOOG) in mobile computing.
Ballmer has focused on making devices, such as the Surface tablet and Xbox gaming console, and turning key software into services provided over the Internet.
Some investors say that a new chief should not be bound by that strategy. They are concerned that, with both Gates and Ballmer up for re-election to Microsoft's board, they will retain their influence over the company.
Gates has focused his day-to-day efforts on philanthropy since 2008 when he vacated his office on campus. People close to him say he is not considering a return to the CEO position.
Members of the CEO search committee have been speaking with dissenting shareholders, according to sources familiar with the conversations.
Activist shareholder ValueAct Capital Management was offered a board seat by Microsoft in August. Several sources said the investor will also be given the same access as the board to the final five candidates.
Mulally, 68, is credited with inspiring a cultural change that helped Ford reverse its losses and avert a federal bailout in 2009.
It remains unclear when Mulally will leave Ford, which he has led since 2006. He has repeatedly said he plans to adhere to his agreement to stay with Ford until the end of 2014.
But people familiar with the matter have previously said that Mulally is open to other opportunities and may leave Ford earlier if another job presents itself.
Elop ran Microsoft's business software division before jumping ship to Nokia in 2010. Although he is seen as an external candidate for the Microsoft CEO job, he is set to return to his former employer after the closure of its 5.44 billion euro acquisition of Nokia's handset business.
The Nokia deal, which came soon after Ballmer's surprise decision to retire, was widely seen as putting Elop among the list of successors.
Meanwhile, the two known internal candidates have been gaining prominence within Microsoft. Bates came to Microsoft two years ago as CEO of the acquired Skype and was recently elevated to lead the technology giant's business development and overall strategy.
Nadella's group is coming to the fore as the company struggles to catch up in online and mobile computing.
-Additional reporting by Bill Rigby, Deepa Seetharaman and Nicola Leske.
The 10 Richest People in America: Forbes 2013 List
Microsoft Narrows CEO Shortlist; Mulally, Elop Make the Cut
Gates remains atop The Forbes 400, a perch he’s held since 1994, despite giving away $28 billion, most of it to the Bill & Melinda Gates Foundation. He’s also again the world’s richest person, having reclaimed that title from Mexico’s Carlos Slim earlier this year. He bolstered his foundation’s efforts to eradicate polio in April, securing $335 million in pledges from six billionaire comrades, including $100 million each from Slim and Mike Bloomberg. Shares of Microsoft jumped in late August on news that Steve Ballmer will step down as CEO, but Gates will remain chairman of the software company he cofounded in 1975 with Paul Allen. Microsoft represents less than a fifth of his fortune. Gates’ investment firm, Cascade, owns chunks of tractormaker Deere & Co., Canadian National Railway and Mexican Coke bottler Femsa.
Neither age nor prostate cancer slows Buffett down: a year after completing radiation treatment, he is still doing huge deals. His Berkshire Hathaway picked up iconic ketchupmaker H.J. Heinz for $23.2 billion in June in a deal with Brazilian billionaire Jorge Paulo Lemann. A Berkshire subsidiary is buying Nevada’s NV Energy for $5.6 billion in cash. He gave away another $2 billion of Berkshire stock to the Gates Foundation in July, bringing his lifetime giving to nearly $20 billion. Despite the gift, he saw his fortune rise $12.5 billion, more than any other member of The Forbes 400, thanks to a 34% increase in Berkshire shares.
Little gets in the way of Larry Ellison’s ambition -- or mouth. In a TV interview in August the Oracle founder said that Apple’s best days are behind it after the passing of Steve Jobs, a close friend, and that Google’s alleged infringement on Oracle’s patents in its Android software was “absolutely evil.” His dream of a winning second America’s Cup sailing trophy was dealt a serious blow in September when a jury found the Oracle team guilty of cheating and docked it two points. He collects houses on Malibu’s Carbon Beach and also owns of 98% of Hawaii’s Lanai island. In his quest for youth he has donated $445 million to his medical foundation to support research on aging and age-related diseases.
Charles is chairman and CEO of Koch Industries, the country’s second largest private company with sales of $115 billion, a post he’s held since 1967. He and his brother David, with whom he shares the fortune, failed to unseat Barack Obama as President in 2012 but keep finding ways to drive liberals crazy. The latest frenzy was over Charles and younger brother David’s widely reported (but never confirmed) interest in buying Los Angeles Times and Chicago Tribune as platforms for their libertarian views. His net worth is up $5 billion this year as Koch Industries steadily expands. The company agreed to buy electronics-components maker Molex for $7.2 billion and cellulose fibers producer Buckeye Technologies for $1.5 billion. They invested $1.5 billion in glassmaker Guardian Industries. The thrifty brothers reinvest 90% of earnings in the business. He studied nuclear and chemical engineering at MIT.
Christy is once again the richest woman in the world. She inherited her wealth when husband, John Walton, a Green Beret and medic in Vietnam War, died in an airplane crash in 2005. She got a huge chunk of Wal-Mart shares. But it is his side investment in First Solar that boosts her fortune ahead of all the other Waltons. That lead, which had narrowed when the stock tanked a couple of years ago, has once again widened, as First Solar shares rose 57% in past year.
The combined fortune of Sam Walton’s heirs is up 27%, or $28.9 billion, from a year ago due to a change in control of the shares held by their late mother’s (d. 2007) trust. Shares of Wal-Mart are up only 2%. Their father Sam and uncle James started the giant retailer in 1962, which now employs 2.2 million people in 11,000 stores worldwide. The siblings have split more than $1.4 billion in dividends after taxes so far in 2013. Jim, Sam’s youngest son, is the CEO of the family’s Arvest Bank, which is worth $1.8 billion and has branches in Arkansas, Kansas, Oklahoma and Missouri.
While the Waltons and Wal-mart continue to get richer, it hasn't been all smiles this past year for S. Robson, the eldest sibling, who has been chairman of the $469 billion (sales) retailer since 1962. Employees organized protests against low wages in 15 cities across the U.S. Wal-Mart also endured criticism for its connection to a bribery scandal in Mexico. The combined fortune of Sam Walton’s heirs is up 27%, or $28.9 billion, from a year ago due to a change in control of the shares held by their late mother’s (d. 2007) trust. Shares of Wal-Mart are up only 2%. Their father Sam and uncle James started the giant retailer in 1962, which now employs 2.2 million people in 11,000 stores worldwide. The siblings have split more than $1.4 billion in dividends after taxes so far in 2013.
Source: Bloomberg LP Age: 71 Residence: New York City Self-made
The world’s richest mayor ends a 12-year run atop the Big Apple in December. His next act is anyone’s guess, but he will likely continue to exert his political influence on the national debate over gun control. His fortune is up $6 billion since last year, thanks to the performance of Bloomberg LP, the financial data firm he founded in 1982 after being fired from Salomon Brothers. He owns 88% of the company, which generated $7.9 billion in 2012 revenue. He also owns at least 10 homes in Manhattan, Westchester County, Bermuda, Vail and the Hamptons. His lifetime philanthropic giving is at $2.8 billion, including a recent $100 million pledge to the Gates Foundation to help Bill Gates eradicate polio.