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Dutch well being know-how firm Philips on Tuesday unexpectedly introduced the approaching departure of CEO Frans van Houten, within the midst of a large product recall that has halved its market worth over the previous yr.
Philips mentioned Van Houten would get replaced on October 15 by Roy Jakobs, head of the corporate’s Linked Care companies, despite the fact that his third time period as CEO was not as a result of finish till April.
“The supervisory board and present Philips CEO Frans van Houten have agreed that with the tip of his third time period in sight, the time is correct for the change in management,” Philips mentioned in an announcement.
“I am proud of the result”, Van Houten advised reporters. “It is at all times troublesome after all to let go, however it’s a logical second handy over after 12 years. It is nice to have the ability to hand over to an inside successor with the conviction he’ll construct on the muse that I’ve laid.”
A particular shareholder assembly might be held on September 30 to nominate Jakobs, who joined the corporate in 2010, as CEO.
Philips shares had been up 2.2 p.c in early Amsterdam buying and selling, however are nonetheless down greater than 50 p.c because it shocked traders in June 2021 by recalling 5.5 million ventilators used to deal with sleep apnoea.
Foam used for sound dampening can degrade and emit small particles that irritate airways, whereas gases launched by the degrading foam may be poisonous or carry most cancers dangers, the corporate mentioned on the time.
Though this blow to Philips’ popularity may have led it to select an outsider for the highest job, supervisory board chairman Feike Sijbesma mentioned Jakobs was the proper man to repair the corporate’s issues.
“He has in depth worldwide expertise and he elevated the expansion profile of the companies he led”, Sijbesma mentioned.
“He led the ramp up of manufacturing following the recall and is aware of very a lot about affected person security and product high quality, so additionally from that perspective he’s the proper individual. He can hit the bottom working.”
Throughout his virtually 12 years on the helm, 62-year previous Van Houten led the transformation of the once-sprawling conglomerate right into a centered healthcare specialist, spinning off its lighting and client electronics divisions.
Philips now focuses on medical imaging, monitoring and diagnostic gear and competes in opposition to Common Electrical and Siemens Healthineers.
© Thomson Reuters 2022
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