OC Oerlikon, a diversified Swiss textile manufacturer, has fired CEO Uwe Kreuger amid two years of losses and mounting debt. Bloomberg reported that Kreuger will be replaced by Hans Ziegler who has the support of Oerlikon’s major shareholder, Russian billionaire, Viktor Vekselberg. Oerlikon last reported a profit in 2007 when Kreuger took the CEO position. However, the company suffered a $93 million loss in the first half of 2009. The disappointing results are partly due to lack of demand for the latest equipment among cloth makers in Turkey, India, and China after consumer spending evaporated and lenders hoarded funds. More than half of its sales through June were from the company’s automotive and textile machinery units. OC Oerlikon also makes solar equipment and coatings. Adding weight to Oerlikon’s balance sheet is increased net debt from 1.68 billion francs to 1.83 billion francs by the end of last year. The company paid pay back a 600 million-franc loan in the first quarter. Despite cutting 1,500 jobs through June, the company is expected to cut an additional 2,500 positions and sell some of its assets. Ziegler expects to return the company to profitability and said in an interview, “I have been faced with companies that had empty cash boxes and even more debt.”
Swiss Manufacturer Fires CEO, Expects to Return to Profitability
OC Oerlikon fired its CEO as its balance sheet deteiorated through the first half of 2009.
August 25, 2009