Baltimore Technologies CEO ResignsBaltimore Technologies CEO Resigns

Barely a week after beleaguered public key infrastructure vendor Baltimore Technologies plc (stock: BALT) revealed a second round of restructuring, including several hundred job cuts, CEO and deputy chairman Fran Rooney said he will resign. CFO Paul Sanders will be interim CEO as the company searches for Rooney's replacement.

Rooney isn't the only Baltimore exec to leave the company recently. Paddy Holahan, VP of marketing, and David Guyatt, former CEO and founder of Content Technologies Inc., resigned in May. Baltimore acquired Content Technologies in October.

Following the news of Rooney's resignation Tuesday, Baltimore's stock was up 42%, closing at 84 cents a share. However, that's a long way from its 52-week high of $28.50. Trading volume for the day was 726,500 shares, nearly double the stock's daily volume average of 368,070.

"The walls are tumbling down," says Pete Lindstrom, Hurwitz Group security analyst. "Their eyes were too big for their stomach," he adds, citing Baltimore's recent acquisitions. In addition to the $992 million purchase of Content Technologies, Baltimore last year purchased GTE's CyberTrust for $150 million, took a 72.5% stake in Japan's NSJ valued at $2.5 million, and bought Nevex Software Technologies for $42 million.

In the short run, Lindstrom says, Baltimore would be wise to look toward the health insurance and financial services sectors as it focuses on its strengths in digital signature technology. "In the long run, Baltimore is perfectly positioned to address the coming need for the security of Web services with PKI and XML as the foundation."

Effective Thursday, two former Baltimore execs will return to the board. David Guyatt will return to Baltimore as a nonexecutive director, as will Bijan Khezri, who served as a director with Baltimore from 1998 to 2000.