BERLIN, July 6 (Xinhua) -- The supervisory board of German steel giant Thyssenkrupp accepted the resignation of its chief executive officer (CEO) Heinrich Hiesinger on Friday.
A spokesperson for the DAX-listed company confirmed that Hiesinger made an unexpected request on Thursday night to be relieved of his executive duties. The request was approved and hence made formal by the supervisory board on Friday.
The remaining management board members will now take over the lead at Thyssenkrupp in the interim while a "structured process" is launched to find a CEO replacement.
Hiesinger's resignation was announced shortly after he finalized a controversial and hard-won merger of Thyssenkrupp's steel unit with the European subsidiary of Indian rival Tata Steel. The CEO subsequently explained that he had made a "conscious decision" to leave the company and hence enable the supervisory board to have a "fundamental discussion about the future of Thyssenkrupp".
During his seven-year tenure, Hiesinger repeatedly clashed with Thyssenkrupp's second largest shareholder, Cevian. The Swedish investment fund repeatedly accused the CEO of poor financial performance and mismanagement, calling for a radical break-up of the company.
In response to such criticism, Hiesinger highlighted what he saw as the advantages of an integrated corporation, whilst describing the Thyssenkrupp-Tata fusion as the starting point for more far-reaching reforms at the industrial behemoth. "We are leading Thyssenkrupp as an integrated company because this results in measurable advantages," he told investors at the firm's most recent annual general meeting.
At the same time, Hiesinger rejected claims that he had resisted attempts to reduce complexity at Thyssenkrupp, emphasizing that the number of business divisions had declined from eight to five during his tenure. Additionally, Thyssenkrupp would only initially retain a 50-percent stake of the Netherlands-based corporate entity for the merged steel business with Tata, and is currently still deciding whether to dispose of its shares thereafter.
Ulrich Lehner, chairman of the supervisory board, emphasized on Friday that Thyssenkrupp's foremost priority after Hiesinger's departure was to "stay its course in a difficult situation." Lehner praised the long-standing CEO for having established the foundation for Thyssenkrupp to persist as a "strong industrial conglomerate" in a highly competitive environment.
However, Wilhelm Segerath, the chief of the Thyssenkrupp workers council, expressed concern that the executive reshuffle could reignite the debate over the strategic outlook of the company.
Segerath warned that shareholders took Hiesinger's resignation as an opportunity to pressure the supervisory and management boards into selling off individual Thyssenkrupp business units.
