October 8, 2019 / 6:24 AM / 10 days ago

Struggling TV and stereo maker Bang & Olufsen changes CEO

COPENHAGEN (Reuters) - Shares in Bang & Olufsen (B&O) (BO.CO) jumped on Tuesday after the struggling Danish TV and speaker maker said its chief executive was leaving with immediate effect, to be replaced by former Logitech (LOGN.S) executive Kristian Tear.

FILE PHOTO: The logo of consumer electronics company Bang & Olufsen is seen at a shop in Vienna, Austria, July 7, 2016. REUTERS/Heinz-Peter Bader/File Photo

Tear, who will replace Henrik Clausen, told Reuters he would continue with an existing turnaround plan, which aims to boost margins by cutting the company’s distribution network and leaving it with fewer selling points.

“In Logitech we managed to get a positive growth mindset throughout the organization, and I hope to do the same with B&O, focusing more on the financial results when executing our strategy,” said Tear, who was vice president at keyboard and mice maker Logitech until April.

Shares in B&O are down more than 70% over the past year as it has struggled with weak demand for its TVs and repeatedly cut sales and profit forecasts.

The stock rose as much as 9.5% at the market open and was 3.3% higher at 1138 GMT.

ABG Sundal Collier analyst André Thormann said investors were reacting positively to the change in leadership, but doubted whether it would be enough on its own.

“People are important, but it is hard to tell whether a new CEO will be enough to turn things around as the company has already been trying to face its product challenges and transform the business,” Thormann said.

B&O’s biggest shareholder is Chinese investor Qi Jianhong, who owns just under 15% in the company through his Sparkle Roll companies, according to Refinitiv data. In April 2016, B&O rejected a takeover bid from Sparkle Roll.

B&O Chairman Ole Andersen said in August, after the company’s third profit warning, that “the warning bells” were starting to ring and that the board would listen if approached by a buyer.

The company, whose televisions can sell for up to 96,000 Danish crowns ($14,123), was founded in 1925 and built its initial success on innovative audio technology.

Reporting by Andreas Mortensen; Editing by Jacob Gronholt-Pedersen and Mark Potter

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