Siemens names Peter Loescher as new CEO

Gerhard Cromme, head of the supervisory board of German engineering group Siemens AG and the newly appointed Siemens President and CEO, Peter Loescher (R) give a statement outside the company's headquarter in Munich May 20, 2007.

FRANKFURT (Reuters) - Scandal-battered Siemens (SIEGn.DE) has turned to an outsider in its search for a new chief executive, naming a top U.S. healthcare industry executive as its new leader on Sunday.

Peter Loescher, 49, the head of global human health at Merck (MRK.N) since April 2006, will take office on July 1, Siemens said in a statement.

He replaces Klaus Kleinfeld who will step down as president and chief executive on June 30, the company said.

Speculation on who would fill Kleinfeld's post has been running high in recent weeks with a number of names mentioned in media reports but not that of the Austrian-born Loescher.

As an outsider Loescher will need to work at gaining support, German shareholder rights group DSW said.

"The company has been very self-contained. Loescher will need to build a powerbase for himself and then ensure his acceptance," Juergen Kurz from DSW said in an interview with German Daily Der Tagesspiegel.

A source with knowledge of the situation told Reuters last month that Siemens preferred an external candidate to ensure a new chief executive would not be drawn into ongoing investigations into bribery allegations.

"In Peter Loescher we have found an exceptional individual for the office of president and CEO of Siemens AG," Chairman Gerhard Cromme said.

"I am convinced that Mr. Loescher has what it takes to steer Siemens through its current difficulties and into a better future," he added.

German metal union IG Metall welcomed the appointment.

"The company, customers and most of all the employees need clarity, therefore it is appreciated that the supervisory board came to a decision so quickly," said Werner Neugebauer, who heads IG Metall's section in Bavaria, where Siemens is based.

"Now there's a chance for a fresh start," he added.

CAREER MOVE

Merck and Co. has been one of the world's best-performing pharmaceutical stocks in the past 12 months, rising 56 percent since Loescher was named to his post with the U.S. drugmaker.

During the period, company sales growth has revived thanks to popular new medicines and vaccines. But the drugs were in development long before Loescher arrived.

Morningstar analyst Heather Brilliant said it was too soon to make an assessment of Loescher.

"It's an important position but Mr. Loescher just hasn't been at Merck long enough to assess his contributions, and for the time he has been there I would say he has had a medium-level profile," she said

"This looks purely like a career move for him and not a reflection on Merck," Brilliant added.

Loescher has also gained management experience at General Electric (GE.N), where he headed the GE healthcare biosciences division as well as at Amersham, Aventis Pharma and Hoechst.

NEW LEADERSHIP

Siemens, the trains-to-lightbulbs conglomerate rocked by a bribery scandal, has been keen to find new leadership following the resignation of its nonexecutive chairman and its chief executive last month.

Kleinfeld said in April he would step down as CEO once his contract expires at the end of September after failing to get clear backing from the supervisory board for a contract renewal.

Kleinfeld, whose offices have been searched, is not a suspect in the corruption probe.

Siemens is being investigated by German and U.S. authorities in several separate cases of suspected bribery involving hundreds of millions of euros.

The company also said it had appointed Heinrich Hiesinger to Siemens's managing board. Hiesinger is currently head of Siemens Building Technologies (SBT).

Hiesinger will be responsible for IT services and corporate information as well as European business and by the end of the year for personnel too, the company said.

He takes over the posts of Johannes Feldmayer and Juergen Radomski, whose contracts will not be renewed.

Feldmayer was released on bail after being arrested in March and questioned over allegations of bribery in connection with German workers' association AUB.

Siemens said a successor for Hiesinger at its SBT unit would be announced in the near future.

(Additional reporting by Ransdell Pierson in New York))