Sun, July 21, 2024

Stocks: ABB Shift Gears with Rosengren as Model Successor

Stock Exchange

In an early Monday trading, ABB shares jumped almost 4%. It was when investors in a trade meeting welcomed the Swiss engineering group, which pulled Bjorn Rosengren from the Swedish mining equipment firm Sandvik to be its next chief executive.

On Sunday, the company indicated that Rosengren would take over at the Zurich-based maker of industrial drives and robots in March.

The previous ABB CEO, Ulrich Spiesshofer, has suddenly left in April. He is in the middle of overhauling its business following years of dull profit and messed up acquisitions.

On Monday, Chairman Peter Voser, who has CEO functions on an interim basis, said he was confident he had got the right man.

Voser tweeted, “as my successor CEO, Bjorn Rosengren is the ideal candidate to take ABB forward, together with our strong team on the Executive Committee.”

In addition, he said, “He understands how to empower people to perform and create long-term value.”

Progression Moved by Rosengren, per Stock Report

Rosengren reorganized the processes of the metal-cutting tools and mining gear maker during his four years at Sandvik. He also sold off underperforming businesses.

ABB has lost 14% of its shares over the past five years in the share market.

Now, it is selling its power grids business to Hitachi. Last month, they also proclaimed a deal that let them quit the solar energy inverters business.

The former CEO of oil major Shell, Voser, launched a review of businesses. From that, it had generated $3 billion of revenue, or 11% of ABB’s total. This can still be improved or sold.

Analyst Alexander Virgo said, “with the appointment of Rosengren, ABB will have a CEO with a proven track record and a reputation in the capital markets for delivering operational improvement.”

He also added, “in our view, his success while implementing a decentralized business model should make him a good match for ABB.”

Lastly, “which is seeking to make a fundamental shift in corporate culture following the sale of Power Grids.”

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