Ben Verwaayen is leaving his job as CEO of Alcatel-Lucent having failed to deliver a turnaround at the struggling telecoms vendor which has reported a 2012 loss.
The company has reported a full-year net loss of EUR1.372 billion for 2012 as a result of falling sales in Europe and China, as well as an impairment charge. Annual revenues fell by 5.7 per cent to EUR14.45 billion.
Verwaayen will remain in his job until a successor has been found, the company said in a statement. The board had started to look for a new chief executive to takeover following Alcatel-Lucent’s annual general meeting in May.
Verwaayen set himself a three-year target for recovery when he took over Alcatel-Lucent in 2008 but the company has struggled recently as a result of operator spending cuts and competition from the likes of Huawei and ZTE.
There has been speculation for some time that he would stand down.
The board says it will look at both internal and external candidates. Verwaayen said he would not seek re-election at the general meeting.
“Alcatel-Lucent has been an enormous part of my life. It was therefore a difficult decision to not seek a further term, but it was clear to me that now is an appropriate moment for the board to seek fresh leadership to take the company forward,” he said.
A story in the Wall Street Journal quoted two sources, one saying the company’s directors had become frustrated at Verwaayen’s slowness in delivering a recovery. A second source said his departure was a mutual decision and he had stabilished the company.
In Q4 results, Alcatel-Lucent made a loss of EUR1.374 billion on revenues that fell 1.3 per cent to EUR4.1 billion. The company delivered a positive 13.7 per cent growth in US sales which was offset by disappointing performances in Europe and Asia.
Verwaayen argued the Q4 results “reflected the early progress of the performance program” which it announced last July. He also said the full-year results were in line with guidance. However he supplied no guidance for 2013.
The company will not pay a dividend in 2012.
In recent months, the company has considered various measures to raise new finance including loans, selling off business units and licensing its patents to outside investors.