Segal moves to Microforum

Former Chapters Online Inc. president Rick Segal has arrived at Microforum Inc. at a time when the e-commerce company is poised to expand rapidly into the United States and has applied for a listing on the Nasdaq Stock Market.

In an unexpected shift this week, Mr. Segal resigned as president of Chapters Online, saying he wanted to work in a technical rather than a retail field. As Microforum's new president and chief operating officer, he got a warm welcome from shareholders at the company's annual meeting yesterday.

"Strap up kid, you've got a lot of work ahead," said Howard Pearl, Microforum's chief executive officer.

The company, which executives say has about 2 per cent of its shareholders in the United States, applied for a Nasdaq listing on Friday, and expects to have a reply in about two months.

Analysts responded favourably to the sudden shift in management at Microforum.

"It indicates that the company is willing to distribute the management responsibilities around," said Adam Adamou, vice-president of institutional equities with Taurus Capital Markets. "When you are willing to do that, it indicates that the company has matured beyond the one or two initial players. It is ready for the next stage."

However, while the move "couldn't hurt" the share price, Mr. Adamou said that yesterday's intraday price jump wasn't out of line with the volatility level at which the stock has been trading.

On the Toronto Stock Exchange, the stock closed yesterday unchanged at $8.20.

In an interview, Mr. Segal said that the last thing he looked at when he joined the company was the share price, instead preferring to focus on the capabilities of the company. Once he was finished building the retail Internet service for Chapters Online, he said, all that was left to do was sell books, and he was ready to move on to his next major technical project. That project became Microforum, which works closely with Chapters Online. Chapters Online was featured in the meeting's client feedback presentation.

Mr. Pearl said that when introducing Toronto-based Microforum technology to the United States, there must be a large amount of investment into marketing the product; hiring more talented professionals; and making acquisitions. Microforum recently announced that it had signed a letter of intent to acquire Blue Hypermedia Inc., a New York-based Web development firm and new media production company.

The company has remodelled itself in the past 20 months, Mr. Pearl told shareholders, developing its e-commerce operations from their publicity-shy beginnings to a highly promoted e-commerce strategy and databasing company that counts Ford Motor Co. of Canada Ltd. and Microsoft Canada Co. as clients.

"Back then, we were keeping our heads down, focusing on business, so we didn't slip and fall. We are now prepared to tell the world about us," said Mr. Pearl, adding that many of Microforum's clients are not dot-com companies, but rather are making a transition into e-business.

"There's no company in this country that doesn't need us. You haven't seen anything yet," he added.

Along with the new image come new professionals, a new vision, and even a rock song -- played at yesterday's meeting in a video presentation featuring client voice clips and cellphones spinning across the sky. At the meeting it was also announced that the corporation's stated capital had been reduced, the number of stock options had been increased -- from 6.5 million common shares to 8.25 million -- and the company officially moved its Toronto headquarters.