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TELIA - Telia AB News Story

SEK36.2 0.0  0.1%

Last Trade - 4:05pm

Sector
Telecoms
Size
Large Cap
Market Cap £12.64bn
Enterprise Value £21.06bn
Revenue £7.57bn
Position in Universe 55th / 1836

UPDATE 1-CEO of Nordic telecoms group Telia in surprise resignation

Mon 5th August, 2019 10:02am
* Dennelind has overseen Telia transformation
    * Will work notice period while Telia seeks replacement
    * Shares down 1.8%

 (Adds detail, background, analysts, shares)
    By Anna Ringstrom
    STOCKHOLM, Aug 5 (Reuters) - Telia  TELIA.ST  Chief
Executive Johan Dennelind has resigned unexpectedly, having
transformed the Nordic telecoms group's strategy since taking
the helm in 2013.
    Under Dennelind's leadership Telia has withdrawn from nearly
all of its central Asian markets after years of investigations
into alleged corruption linked to local partners, such as in
Uzbekistan, and problems accessing cash in some markets.
    When he took the job, those operations accounted for about a
quarter of profit, but the mobile and fixed-line operator has
since refocused on its seven Nordic and Baltic operations,
seeking new growth opportunities such as a push into television.
    The ongoing overhaul includes its planned takeover of
television group Bonnier Broadcasting, with the deal currently
being scrutinised by EU antitrust regulators.
 urn:newsml:reuters.com:*:nL5N22M5R0 urn:newsml:reuters.com:*:nL8N21D1NT 
    Dennelind, who has given Telia 12 months notice, has also   
instigated a cost-cutting programme and overseen the acquisition
of Tele2 Norway and GET Norway. The company has also entered
network-sharing agreements in Denmark and Finland under his
tenure.  
    Credit Suisse analysts said the timing of Dennelind’s
resignation is a surprise, though there had been some
speculation over the past year about a change in CEO given he
has been in role more than five years and the Eurasian exit is
close to completion.
    Board Chairwoman Marie Ehrling said Dennelind's leadership
had been crucial during the overhaul and that she and the board
regretted his decision to step down. 
    
    SEARCH IS ON
    Dennelind will continue in his position for the time being,
Telia said in a statement, adding that the exact timing of his
departure depends on the recruitment of a successor. The search
for a new CEO will begin immediately, it said.
    The outgoing chief said Telia is now entering a new phase
with several opportunities for value creation and he has decided
to leave to take on new challenges.
    "I will continue in my role to drive our current agenda
forward with full focus and commitment for as long as the board
wants,” Dennelind added in the statement.
    Credit Suisse analysts said that, with Telia broadly
repositioned as a Nordic and Baltics story, it expects
"relatively little disruption" from Dennelind's departure.
    "The main question is in what direction a new CEO will
take," they added.
    In April, Telia reiterated that profits in Sweden, its
biggest market, would remain under pressure this year and that
it would cut operating costs in the country by about 3 percent
to offset falling fixed-line income.  urn:newsml:reuters.com:*:nL5N22713H
    Shares in Telia, which have lost about 15% of their value
since Dennelind became CEO, were down 1.8% in morning trade,
slightly outperforming the wider Stockholm market  .OMXS30 .
    "Since we don't know the successor, it is difficult to say
if this is a good or bad thing for the company," said Inderes
analyst Joni Gronqvist.
    "However, Dennelind has been effective starting the strategy
implementation, putting Telia in good shape for whoever takes
over." 
         

 (Reporting by Anna Ringstrom
Additional reporting by Tommy Lund in Gdynia
Editing by David Goodman)
 ((anna.ringstrom@thomsonreuters.com; +46 8 700 1134; Reuters
Messaging:
anna.ringstrom.thomsonreuters.com@thomsonreuters.net))
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