Benjamin Shaw has stepped down as president and CEO of Covetrus Inc. less than nine months after the Portland-based company’s troubled launch.

Shaw will receive more than $2.3 million in severance compensation and will transition to a role as strategic adviser to the board of directors, the company said.

The launch of Covetrus, Maine’s largest publicly traded company in terms of sales, has been fraught with problems since the veterinary technology and services firm’s initial public offering in February, including weak second-quarter financial results, a precipitous decline in its share price and an investor lawsuit filed in September that accuses the company of securities fraud.

Benjamin Shaw

Benjamin Wolin, who had been chairman of the company’s board, will assume the role of acting president and CEO, Covetrus said in a news release Tuesday. Philip Laskawy, the board’s lead independent director, will take over as chairman.

The release offered no explanation for Shaw’s ouster, but included a prepared statement by Laskawy regarding the leadership change.

“Covetrus offers a compelling and transformative value proposition within the global animal health market, and Benjamin Wolin, with his deep expertise in public company management in the digital healthcare, pharmacy and technology space, is the right leader to help the company successfully focus and execute on its strategy,” Laskawy said. “We also want to take this opportunity to thank Benjamin Shaw for his contribution as a founder of Vets First Choice and Covetrus. His entrepreneurial spirit and vision helped guide the company to this moment and we look forward to working with him as a strategic adviser.”

The company filed a notice Monday with the U.S. Securities and Exchange Commission stating that Shaw “has resigned effective immediately” from his roles as president, CEO and a director on the company’s board. It says Shaw will stay on as a strategic adviser to the board “for a period to be mutually agreed, which shall not be less than six months.”

The SEC notice says Covetrus has entered into a separation agreement with Shaw under which he will receive severance equal to 24 months of his base salary, or roughly $1.7 million, and “a prorated annual bonus of $672,575, payable no later than March 15, 2020.”

Covetrus assured investors that the company would be in good hands with Wolin at the helm. He is the co-founder and former CEO of Everyday Health Group, a health care industry digital media and marketing group based in New York.

Covetrus was created by the merger of Portland-based Vets First Choice and a spinoff of the animal health division of Henry Schein Inc., a Melville, New York-based health care products and services firm. Vets First Choice was founded in 2010 by Benjamin Shaw and his father, David Shaw, who initially served as chairman of Covetrus’ board.

Its stock began trading on the Nasdaq stock exchange under the symbol CVET on Feb. 8 at roughly $43 per share. The company’s share value fell as low as $8.16 per share Tuesday before rebounding slightly to close at $9.46 per share.

Covetrus’ Aug. 13 earnings release for its first full quarter of operations fell far short of analyst expectations and led to a stock sell-off that slashed the company’s share value by 40 percent in a single day. Covetrus also revised its previous earnings outlook for the year from $250 million to $200 million, citing unanticipated merger-related costs and a slowdown in customer activity.

On Sept. 4, the company announced that David Shaw, founder of Westbrook-based Idexx Laboratories Inc., was stepping down from his role as chairman, although he remains a director on the board.

A lawsuit filed Sept. 30 in U.S. District Court for the Eastern District of New York accuses Covetrus and its top executives of knowingly misleading investors about the company’s financial challenges and its ability to execute on its business plan following the merger of Vets First Choice and Henry Schein Animal Health.

The plaintiff in the case, Covetrus institutional investor the City of Hollywood (Florida) Police Officer Retirement System, is seeking class-action status, and more than a dozen other class-action law firms have issued calls for additional plaintiffs to join the case or file their own lawsuits.

Vets First Choice received city approval in fall 2018 to build a five-story, 170,000-square-foot headquarters for Covetrus in downtown Portland. The facility is expected to provide office space, a pharmacy, fulfillment center, and software and data science labs. It is designed to have space for 1,500 employees – 1,200 more than the company’s current Portland employee base of roughly 300. Covetrus has said it employs about 5,500 workers worldwide.

On Tuesday, Covetrus spokeswoman Kini Schoop said the Portland headquarters project was proceeding as planned despite the company’s leadership changes. Schoop said Covetrus executives were not granting interviews Tuesday.

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