ABB shares increases rapidly as new CEO increases turnaround hopes
ABB shares increased almost by 4% in early Monday trading. Investors welcomed news that ABB appointed CEO of Swedish mining equipment firm — Sandvik, Mr. Bjorn Rosengren to be its next CEO. Mr. Bjorn Rosengren will join Zurich-based manufacturer of industrial robots and drives in February. In addition, he will take over in March as CEO, the company announced on Sunday. ABB former CEO – Ulrich Spiesshofer left in April suddenly, in the middle of fixing its business, and bungled acquisitions. In addition, chairman Peter Voser, who is working as an acting CEO on an interim basis, announced on Monday that he was confident and he had got the right man.
ABB Schweiz AG is a manufacturer of automation and electronic products. The company also distributes electronic equipment for natural gas, housing, airport, robotic, and automotive industries. The company provides service, training, consulting, and design of new distribution and transmission systems. The company offers its products and services across the globe.
Peter Voser said Bjorn Rosengren would follow the ABB’s strategy of decreasing its corporate center. In addition, will give more power to its business units – electrification, industrial automation, discrete automation, and motion and robotics. ABB shares have lost about 14% over last five years. Also, the company is selling power grids business segment to Hitachi as well as announced a deal to quit its solar energy inverters business. Peter Voser launched a business segment review which generate revenue of around US$ 3 billion, or around 11% of ABB’s total sales, which could be sold or improved. According to Bank of America, with appointment of Rosengren, the company will have CEO with a strong reputation and proven track record and in capital markets for providing operational improvement. Moreover, Peter Voser said in our view, Rosengren success at Sandvik in applying a decentralized business model would make Rosengren a good match for their company.”