Schneider ousts CEO after differences over strategy
Peter Herweck was CEO of French multinational Schneider Electric for 18 months. He is being replaced by company veteran Olivier Blum, the chief of its key energy management business.
Schneider Electric has unexpectedly removed CEO Peter Herweck due to differences over how the French multinational company's strategy was being executed.
“The Board of Directors decided to remove from office Peter Herweck as Chief Executive Officer due to divergences in the execution of the company roadmap at a time of significant opportunities,” it said in a statement.
Herweck was CEO of Schneider for 18 months. He is being replaced by company veteran Olivier Blum, the chief of its key energy management business.
The board chose Blum unanimously to “accelerate the execution of its strategy,” Schneider said.
“The CFO and Head of IR hosted a short call this morning that outlined the Board felt the strategy was not being as decisively or collaboratively implemented as hoped and that the CEO's style was not a fit,” J.P.Morgan said in a note to clients, according to a Reuters report.
The French industrial giant, which specializes in digital transformation of energy management and automation, has a market capitalization of around 140 billion euros.
According to Schneider’s latest earnings report, systems and services were the main drivers of growth as the group reported record third quarter revenue of 9.3 billion euros, an increase of 8% from the same period last year.
Digital Services delivered double-digit growth in the quarter ended September, driven by the energy management division’s performance in this segment.
However, the company has grappled with supply constraints that impacted its sales growth in North America, especially in the US residential buildings market, according to media reports. Schneider was also fined by French regulators in a price-fixing case.
Blum, who has been with Schneider for over 30 years, has served in key roles including as country head for India and strategy and business leader in China.
Schneider recently acquired US-based Motivair Corporation, which specializes in advanced liquid cooling solutions used in data centres. Schneider acquired a 75% stake in Motivair in all all-cash acquisition costing USD 850 million. It has an option to acquire the remaining 25% of the company by 2028.
