Off The Wire
Thyssenkrupp shareholder criticises CEO, demands restructuring
FRANKFURT, Jan 13 (Reuters) - A major shareholder in Thyssenkrupp has criticised Chief Executive Heinrich Hiesinger for failing to achieve his own profit targets, raising tensions before the German industry group's annual meeting next Friday.
Swedish investor Cevian reiterated its call to restructure Thyssenkrupp, in which it controls an 18 percent stake, effectively challenging Hiesinger's plan to merge its steel business with that of India's Tata Steel .
"Thyssenkrupp is not developing in the way we expected. Something has to change in the structure of the business," Lars Foerberg, co-founder of Cevian, told the Frankfurter Allgemeine Sonntagszeitung.
In extracts of the interview released ahead of publication on Sunday, Foerberg took Hiesinger to task over his long-term plans to achieve operating margins of between 6 and 7 percent at Thyssenkrupp's non-steel operations.
"Even today, the company is still achieving just half of its margin target. That is simply too little," Foerberg told the newspaper.
He did not give a direct answer to a question on whether Hiesinger should resign, but said: "If a strategy doesn't achieve the desired goal, you have to change it. We expect that both from the Thyssenkrupp management and supervisory boards."
Cevian last clashed with Thyssenkrupp after third-quarter results were published in November that showed the company achieving its highest order intake in five years as it develops its 'smart' elevator and automotive businesses. While facing investor criticism that Thyssenkrupp's conglomerate structure is outdated, Hiesinger has also sought to placate a unionised workforce fearful of job losses that might arise as a result of the steel merger. Thyssenkrupp management and workers finally struck a deal in December to secure steel plants and jobs, in a major step towards completing a merger that would create Europe's second-largest steel group after Arcelormittal . (Reporting by Douglas Busvine; Editing by Kevin Liffey)