Reuters logo
UPDATE 1-Cargotec demotes CEO, cheering investors
October 4, 2012 / 10:31 AM / 5 years ago

UPDATE 1-Cargotec demotes CEO, cheering investors

* Makinen to step down from CEO role, to lead marine unit

* Board vice chairman Hakakari to be interim chief

* Shares rise 4.5 pct (Adds comments from analyst, CEO, share reaction)

HELSINKI, Oct 4 (Reuters) - Finnish cargo handling equipment maker Cargotec demoted its chief executive, raising expectations a change in leadership could help the company improve its profitability.

Cargotech shares rose 5 percent after the company said Chief Executive Mikael Makinen would step down and instead lead its marine unit, which is planning to list in Asia next year.

Cargotec has struggled with weak profitability this year, and announced earlier this week that it planned to cut around 245 jobs.

Makinen had led the company since 2006.

“Often in a company that is experiencing difficult times and disappointments, a management change raises expectations that there will be change for the better,” said Pohjola analyst Pekka Spolander.

The company cut its full-year guidance in June, blaming weakness in its terminals segment, but some analysts say Cargotec’s problems are less about economic issues and more about its inability to manage costs.

Makinen said he was content with the new role at the unit, citing previous experience in Asia and saying he was “more into operative jobs”.

Cargotec is aiming to list its marine unit in Singapore or Hong Kong by the second half of 2013 and use the proceeds to finance new investments. Many of the world’s biggest shipyards and marine related businesses are located in Asia.

Makinen told Reuters that the marine unit will decide in the next two months which bourse to list on. The unit makes equipment such as electrical cranes and hatch covers for sea transportation and offshore industries, and Cargotec is planning to retain a majority stake in it after the listing.

The company said it was looking for a new CEO and that Tapio Hakakari, currently vice chairman of Cargotec’s board who previously worked at Finnish companies Kone and Konecranes, would act as interim chief.

Cargotec shares were up 4.49 percent at 18.86 euros at 1028 GMT. (Reporting by Terhi Kinnunen and Jussi Rosendahl)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below