ABB boss quits over policy clash
The head of engineering giant ABB has quit after a clash over strategy, raising questions over acquisition plans
The Swiss-based group admitted that chief executive Fred Kindle was going because of a disagreement. It said in a statement: "Fred Kindle is leaving the company due to irreconcilable differences of opinion about how to lead the company."
Kindle was admired by market analysts for restoring growth and stability to a global group that had been on the brink of collapse due to heavy debt.
"We had a high level of confidence in CEO Kindle that he would make the right decisions on acquisitions and his departure now creates substantial uncertainty," analysts at bank J P Morgan said in a note to clients.
Investors have long sought clues as to how ABB, which is benefiting from a boom in electricity generation, plans to spend cash reserves as speculation mounts about plans to grow through acquisitions.
Kindle has long held that large takeovers were not on the cards, in part due to the high price of assets, and analysts have speculated the group would target bolt-on buys worth $1.5bn to $2bn instead.
The company, which sells equipment to utilities and to oil and gas companies, is thought to have cash reserves of around $5bn. ABB is benefiting as Europe and the United States are replacing ageing power systems, while rapid economic growth in emerging economies is forcing countries such as India and China to invest heavily in power infrastructure.
Image: Kindle was against acquisitions