Engineering electronics company announces departure of Ulf Henriksson with immediate effect
British engineering electronics group Invensys has stunned the City by ditching its chief executive, Ulf Henriksson, with immediate effect. The company announced that finance director Wayne Edmunds is taking over.
At one point shares plunged by 8% on the shock news, but later recovered some of their losses.
The company did not say why Henriksson had been replaced. In November he was quoted in the Daily Telegraph as saying China Southern Rail could buy the British company, shares in which rose by almost 10% as a result. The remarks forced the company to rush out a statement to the Stock Exchange denying it was in takeover talks.
Sir Nigel Rudd, the City veteran who chairs Invensys, said on Thursday: "I am delighted that Wayne has agreed to take on the role of chief executive to lead Invensys through the next stage of its development. We have three world-class businesses and a management team to match, and I am confident that Invensys is well positioned to continue to deliver value to shareholders."
Invensys makes rail signalling systems as well as controls for nuclear reactors, industrial plants and domestic appliances. Henriksson has been credited with saving and rebuilding Invensys since becoming chief executive in 2004, as Rudd acknowledged: "I would like to thank Ulf for his hard work and achievements which have delivered a transformation of Invensys. We wish him well for the future."
The company said that its results for the current financial year, ending at the end of month, will be "broadly in line with market expectations". The comments reassured nervy City investors worried that Henriksson's abrupt departure could be down to undisclosed financial problems at the group. Some analysts speculated that a profits warning could be in the pipeline.
Invensys was formed in a merger of Siebe and BTR in 1999, and has undergone restructuring in the past decade to cut costs. A disposal programme, combined with debt restructuring in 2004, saved the firm from collapse.
Manufacturing firms are benefiting from a surge in infrastructure projects coming on stream in emerging markets which had been delayed by the global financial crisis. The market for rail equipment is thought to be worth $100bn (�61bn) globally.
Some analysts in the City have been talking up the possibility that Invensys could become a bid target as larger rivals emerge from the slowdown with large amounts of cash after cutting costs.
Source: http://www.guardian.co.uk/business/2011/mar/24/invensys-ditches-chief-executive-ulf-henriksson
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