April 10, 2019 / 12:49 PM / in 14 days

Airbus names ex Deutsche Telekom boss as next chairman

AMSTERDAM (Reuters) - Airbus nominated a new German chairman on Wednesday as Frenchman Guillaume Faury prepared to become its chief executive, signaling that the Franco-German balance at its helm will extend through a sweeping management overhaul.

FILE PHOTO: Deutsche Telekom CEO Rene Obermann attends a news conference to present a joint initiative for encrypted email with United Internet in Berlin August 9, 2013. REUTERS/Thomas Peter/File Photo

Europe’s largest aerospace company said it would propose former Deutsche Telekom chief Rene Obermann as chairman from 2020, completing the shift to what current chairman Denis Ranque called a “new generation of management”.

Obermann, a managing director of private equity firm Warburg Pincus, had been seen as a German favorite to succeed Ranque, who had already announced plans to retire next year.

Airbus, which is facing multi-national investigations for suspected bribery, changed its rules in 2013 to become more independent of French and German governments, which each hold 11 percent of its shares.

But senior appointments remain sensitive as it continues to carry the scars of previous power struggles, and people close to the company said the decision to announce Ranque’s successor a year early would send a message to Berlin that an effective bi-national balance would be maintained.

Airbus is in the midst of a board-led clearout to present a new face in any bribery settlement negotiations - a subject that has also threatened Franco-German discord.

Obermann ran Deutsche Telekom from 2006 until 2013, and will be remembered for his attempt to sell T-Mobile US to AT&T, which ultimately failed but netted Deutsche Telekom a break fee of $6 billion.

The announcement of his appointment came as German Tom Enders prepared to step down as chief executive to be succeeded by current jetmaking division chief Faury.

Airbus said it was cutting the amount paid to future chief executives in the event of contract termination to a year’s salary and bonus from 18 months and capping possible non-compete clauses to one year.

Enders’ nearly 40 million euro retirement package - including a 3.2 million euro non-compete clause valid for at least a year - has triggered a row in France.

Enders did not receive a termination payment because he is retiring at the end of his second mandate as CEO, but the size of his pension pot has been criticized by the French government and could create pressure in France for more regulation.

Airbus said it was taking the decision “in line with market practices” and corporate guidelines in the Netherlands where it is registered despite having its headquarters in France.

In his first comments to shareholders, Faury said his priorities included working on new production methods and pursuing a company drive to “leverage the power of data”.

Reporting by Tim Hepher, Georgina Prodhan; Editing by Sudip Kar-Gupta and John Stonestreet

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