Alliance Data Systems Corp. planned on hiring Ralph Andretta as the top deputy to its new chief executive officer. Instead, it decided to name him as her replacement.
Andretta, who was head of Citigroup Inc.’s U.S. branded credit card business, will join Alliance Data in February as president and CEO. He replaces Melisa Miller, who had been at the helm of one of the country’s largest issuers of private label credit cards for only five months after she was named CEO in June.
Alliance Data Chairman Rob Minicucci said the lender had been looking for someone who could fill the newly created role of chief operating officer and eventually be Miller’s successor.
“As board members came to know Ralph Andretta and understand the breadth and depth of his card business experience, operational leadership strength and financial expertise, it became apparent that Ralph was an exceptional fit for the immediate strategic needs of Alliance Data,” Minicucci said in a statement. “Hence, a decision was made by the full board to appoint Ralph as the company’s new CEO.”
Miller joined Alliance Data in 2006 and rose to become president of the card-services unit in 2011. She was named CEO in June, two months after the company announced it would sell Epsilon, its $4.4 billion digital marketing business. She’s tried to focus on partnering with more digital retailers and streamline operations to help save $100 million in expenses.
“While it’s unfortunate that the company has moved a key executive who has run the private label business successfully over her tenure, we are encouraged by the fact that Mr. Andretta has extensive background in the card business at a large, publicly facing institution,” Sanjay Sakhrani, an analyst at Keefe, Bruyette & Woods, said in a note to clients.
Replacing Miller weighed on Alliance Data’s shares, which slipped 1% to $103.80 in late trading on Monday. The stock has plummeted 30% this year, the second-worst performance in the 68-company S&P 500 Information Technology Index.
Alliance Data has partnerships with many of the country’s largest mall retailers, including L Brands Inc.’s Victoria’s Secret and Forever 21 Inc. Some partnerships struggled in recent years as more consumers have sought to shop online. In response, the company began shedding roughly 300 jobs in its card-services businesses in Ohio this year.
The lender has been selling certain card portfolios to clean up its balance sheet. Last month, it announced a larger markdown on those card receivables than it had forecast. It also said it saw a bigger slowdown in spending on its cards than expected. The changes caused the company to lower its revenue guidance for the year.
“Our road to transition has been bumpy at times and this road has been cleared and we’re now near it’s end,” Miller told analysts on a conference call in October. “This has positioned us to declare a new beginning and we expect 2020 will be a strong growth year in terms of revenue and profit.”
Citigroup named Craig Vallorano to replace Andretta on an interim basis, according to a memo to staff. Vallorano leads the bank’s private-label card unit.
Andretta had been at Citigroup since 2011, when he was brought in to run the loyalty and rewards programs. He previously spent 18 years at American Express Co. in a variety of roles, including managing the firm’s U.S. consumer cards business.
Citigroup’s ties with Alliance Data also include a
