Flow International Corporation (NYSE:FLOW) shares moved down $0.57, or 4.57%, to $11.90 today giving up Friday's gains after the company announced its financial results and announced that CEO Stephen Light would be retiring as soon as a successor has been found. The turnaround CEO was initially hired to help the company relieve its enormous debt load, reverse the declining sales, return the company to profitability, and restore investor confidence - goals which were all since accomplished. However, the CEO was so instrumental in the success of the company that many investors are beginning to question how well the company will be able to perform without him.

Among these is Daniel Loeb's Third Point, the company's largest shareholder, who expressed their disappointment with Stephen Light's decision to leave the company in a Schedule 13D/A filing with the SEC. The hedge fund noted that they began accumulating their stake two years ago, based on their view of the fundamental strength of the company's target market and technology, and their personal confidence in the leadership of Stephen Light as CEO, based on his record of success in his previous career with much larger companies, as well as his keen analytical ability and communication skills.

Now that Light has left, Third Point believes that the company should be sold rather than continue operating independently under new leadership. Why? Well, the relatively small scale of the company's operations and its disproportionate amount of general and operating expenses (due to being a public company) means that a strategic buyer or private equity fund may be able to unlock far more value than is reflected in the current share price. Based on recent conversations Third Point had with industry participants and a financial adviser, they believe a sale could be transacted at a "significant premium". Whether this happens or not remains to be seen, however this is definitely a stock to keep an eye on over the next few months.

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