BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific
BBCi NEWS   SPORT   WEATHER   WORLD SERVICE   A-Z INDEX     

BBC News World Edition
 You are in: Business  
News Front Page
Africa
Americas
Asia-Pacific
Europe
Middle East
South Asia
UK
Business
E-Commerce
Economy
Market Data
Entertainment
Science/Nature
Technology
Health
-------------
Talking Point
-------------
Country Profiles
In Depth
-------------
Programmes
-------------
BBC Sport
BBC Weather
SERVICES
-------------
EDITIONS
Friday, 6 September, 2002, 09:51 GMT 10:51 UK
ABB buffeted by fresh crisis
ABB worker
ABB has lost its once-stellar reputation
Shares in Swiss-Swedish engineering group ABB have taken a tumble, after the firm unveiled its second management shake-up this year.

After persistent rumours that his job was not safe, chief executive Joergen Centerman stepped down on Thursday evening.

Mr Centerman, who only rose to the top job 18 months ago, cited a personal conflict with chairman Jurgen Dormann as the main factor behind his departure.

But during his brief tenure, ABB has also slumped from being one of Europe's most admired companies to last year recording the first loss in its history.

At the beginning of this year, Percy Barnevik, the firm's highly regarded chairman, announced his early departure from the company.

Problems, problems

ABB's shares, which have already halved in value since the end of last year, lost another 2% in early trading in Stockholm.

Joergen Centerman
Mr Centerman says personalities clashed
Yet another change at the top," said one trader. " You can't help but get the impression that the back and forth continues and nobody knows where this is going."

ABB has lurched from one crisis to another over the past year, including being hit by heavy liabilities for asbestos use at a US subsidiary.

Early this year, Mr Barnevik was at the centre of a bizarre row over his pension allowance, which was condemned as far too generous.

Financially, the firm has a weak balance sheet, and on Wednesday agreed to sell most of its structured finance activities to a unit of General Electric.

Trimming time

The sale will cut its $5.2bn debt mountain to a more manageable $2.9bn, but further cost cuts are planned for later in the year.

Jurgen Dormann
Mr Dormann has little time for ABB's sprawl
Mr Dormann is believed likely to push ahead with more sales of non-core assets, notably the group's oil, gas and petrochemicals businesses.

Without prompt action, analysts have said, ABB could soon become a takeover target for firms seeking to cherry-pick its best assets.

Under Mr Barnevik, ABB built a reputation for near-supernatural acquisition skills, amassing a portfolio of discrete businesses across almost all industrial engineering and technology sectors.

This sprawl is likely to be trimmed under Mr Dormann, who made a name for himself in the late 1990s by restructuring German chemical group Hoechst.

See also:

24 Jul 02 | Business
11 Mar 02 | Business
14 Feb 02 | Business
30 Jan 02 | Business
29 Jan 02 | Business
16 Jan 02 | Business
23 Nov 01 | Business
24 Oct 01 | Business
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories

© BBC ^^ Back to top

News Front Page | Africa | Americas | Asia-Pacific | Europe | Middle East |
South Asia | UK | Business | Entertainment | Science/Nature |
Technology | Health | Talking Point | Country Profiles | In Depth |
Programmes