UPDATE 3-Intel's Maloney, possible CEO heir, suffers stroke

Mon Mar 1, 2010 7:45pm EST

* Intel says Maloney had stroke, on medical leave

* Recuperation expected to be several months

* Intel shares steady (Adds analyst comment, details on job, byline; updates shares)

By Ian Sherr

SAN FRANCISCO, March 1 (Reuters) - The co-head of Intel Corp's (INTC.O) core products group, regarded as a potential successor to CEO Paul Otellini, suffered a stroke at his home and will take several months' medical leave.

Intel said on Monday Sean Maloney is expected to resume his regular duties after a recuperation period thought to last several months. The prognosis for his full recovery is "excellent," the company added.

Analysts say the company is grooming Maloney, 53, executive vice president and general manager of the Intel Architecture Group, as one of several possible heirs to the 59-year-old Otellini.

Maloney, a public face for the world's largest chip maker, a fixture on the business conference circuit and an acknowledged technology expert, had a knack for marketing, analysts say.

"I always thought of him as the heart and soul of Intel marketing," said Wedbush Morgan analyst Patrick Wang. "He had such a good grasp of technology and where the market was going. And he knew how to convey the corporate message without sounding too corporate."

Maloney will be replaced during his leave by Dadi Perlmutter, the other general manager of the Architecture Group.

"He's two in the box with Dadi Perlmutter, so there shouldn't be any disruption at all," said Intel spokesman Chuck Mulloy.

While they share the general manager title, Perlmutter's responsibilities are engineering and design and Maloney focuses on business operations from sales and marketing to investment.

Their group oversees the design and development of the company's microprocessors, the brains of a computer, found in more than eight out of 10 of the world's personal computers.

"It was pretty clear that he and Dadi would be running the company together when Otellini steps down," Real World Technologies analyst David Kanter said.

CAREER-DEFINING EVENT?

Maloney's condition as described will likely not have short-term implications for the company, but the incident could change his career path, Kanter said.

"The bigger question is, long-term, is this something that Sean says, 'Maybe I need to slow down? Or maybe I'm not the right person to step up and be CEO,'" he said.

Under company by-laws, Otellini must retire by the age of 65. But the company's board can put that to a vote and change the by-laws if needed.

Kanter said that time horizon to Otellini's likely retirement is long enough that Intel should have time to firm up a succession plan if need be.

Maloney began work for Intel in Europe in 1982, serving in various managerial positions as well as a stint assisting former Chief Executive Andrew Grove. He took the reins of Intel's mobile division in 2004 and became associated with the company's wireless Internet efforts, including on its long-range WiMAX technology.

Appointed chief sales and marketing manager in 2006, Maloney began his current role just six months ago.

Shares of Intel, the world's No. 1 chipmaker, were briefly halted in after-hours trade. They resumed trading shortly after the statement and have held steady at around $20.87 in post-session trades on Nasdaq. (Additional reporting by Alexei Oreskovic; Editing by Edwin Chan and Richard Chang)

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