BP Taps Ericsson CEO as Next Chairman

Ericsson Chief Executive Carl-Henric Svanberg is stepping down to become Chairman of BP in a surprise appointment that ends the oil major's lengthy search for a new chairman.

Ericsson said it had appointed its current Chief Financial Officer, Hans Vestberg, to replace Svanberg as President and CEO.

Sharon Lorimer

Svanberg will step down at Ericsson at the end of the year and take over from Peter Sutherland at BP in January 2010.

"Everyone had been waiting for something to happen, that is that Carl-Henric would step down," Nordea analyst Mats Bergstrom said.

"That Hans Vestberg is chosen indicates that the board feels the business is moving along well, and investors will appreciate this, feeling that he has a good grip of the numbers."

But a dealer said Svanberg's move follows investor dissatisfaction with management at the telecoms equipment maker. 

The surprise appointment ends a fraught recruitment process at BP. Sutherland had expected to stand down late last year or earlier this year.

BP initially selected miner Rio Tinto's then chairman Paul Skinner, a former Royal Dutch Shell executive, to fill the job.

However, Skinner withdrew following investor unease over Rio's plan to sell $19.5 billion in assets and bonds to Chinese state-owned aluminium group Chinalco, BP sources said.

Skinner stepped down from his Rio role in March and earlier this month, Rio dropped the Chinalco deal.

The failed Skinner appointment poisoned the role for some potential candidates, especially UK businessmen, some executives said.

BP had hoped to select someone with oil industry experience, sources close to the process said, but the Skinner debacle limited its options.

Svanberg will join the BP board in September and, once he becomes Chairman, will be based in London and devote the majority of his time to BP business, BP said.

Svanberg will remain a member of the Ericsson.

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