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Shock departure for Vodafone boss Shock departure for Vodafone boss
(about 2 hours later)
Vodafone chief executive Arun Sarin is stepping down from his post as the head of one of Britain's biggest companies after five years, the company has said.Vodafone chief executive Arun Sarin is stepping down from his post as the head of one of Britain's biggest companies after five years, the company has said.
In a surprise move, he will retire at the end of July and be succeeded by his deputy Vittorio Colao.In a surprise move, he will retire at the end of July and be succeeded by his deputy Vittorio Colao.
The news came as Vodafone unveiled annual pre-tax profits up 2% to £8.9bn.The news came as Vodafone unveiled annual pre-tax profits up 2% to £8.9bn.
Mr Sarin had built a good reputation in the City after a difficult period in 2006 when he faced a shareholder revolt and his performance was criticised.Mr Sarin had built a good reputation in the City after a difficult period in 2006 when he faced a shareholder revolt and his performance was criticised.
That year, Vodafone made a loss of £14.9bn - a record for a UK firm - after it had to significantly reduce the value of its assets, including that of German telecoms firm Mannesmann which it had bought in 2000.
RecoveryRecovery
Under Mr Sarin, Vodafone expanded in emerging markets such as India, Turkey and Romania. I feel that I have accomplished what I set out to achieve, particularly in developing and implementing a new strategy. Arun Sarin, outgoing Vodafone chief executive class="" href="http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/shares/3/23228/intraday.stm">See Vodafone's share price
With mobile phone take-up in Europe near saturation point, by expanding in developing countries, the firm has been able to sign up large numbers of new users.
"I feel that I have accomplished what I set out to achieve, particularly in developing and implementing a new strategy," said Mr Sarin in a statement.
Richard Hunter, from stockbrokers Hargreaves Lansdown, said Mr Sarin's back had been "against the wall" in 2006, when about 15% of shareholders either abstained or voted against him continuing as chief executive.Richard Hunter, from stockbrokers Hargreaves Lansdown, said Mr Sarin's back had been "against the wall" in 2006, when about 15% of shareholders either abstained or voted against him continuing as chief executive.
However, he "has managed to turn that tanker around in recent years", Mr Hunter said.However, he "has managed to turn that tanker around in recent years", Mr Hunter said.
That turnaround was partly due to Mr Sarin's strategy of expanding operations in emerging markets such as India, Turkey and Romania.
With mobile phone take-up in Europe near saturation point, by growing its operations in developing countries, the firm has been able to sign up large numbers of new users.
"I feel that I have accomplished what I set out to achieve, particularly in developing and implementing a new strategy," said Mr Sarin in a statement.
The results of that strategy could be further seen in Vodafone's annual results, also unveiled on Tuesday.
The company said its businesses in emerging markets were performing well, especially in India where revenue had jumped by 50%.
But conditions in Europe were "challenging", the firm said. Pressure from competitors and regulators had pushed prices down by 15.8%.
Vodafone's shares were trading 2.45 pence higher at 165.75p on Tuesday morning.
The firm's shares have risen 38% since Mr Sarin was appointed in July 2003.
SuccessionSuccession
Vodafone chairman Sir John Bond led to the tributes to his outgoing chief executive, saying Mr Sarin had led the company "with distinction".Vodafone chairman Sir John Bond led to the tributes to his outgoing chief executive, saying Mr Sarin had led the company "with distinction".
The news that he will be succeeded by his deputy Vittorio Colao will be welcomed by the City, according to Mr Hunter.The news that he will be succeeded by his deputy Vittorio Colao will be welcomed by the City, according to Mr Hunter.
"The fact that his number two should be able to slip into his shoes will go down well in terms of succession planning," he said."The fact that his number two should be able to slip into his shoes will go down well in terms of succession planning," he said.
"We have seen problems with succession planning even at other FTSE 100 companies.""We have seen problems with succession planning even at other FTSE 100 companies."
Unveiling its results, Vodafone said businesses in emerging markets were performing well, especially in India where revenue had jumped by 50%. Vittorio Colao was tipped to take over the top job at Vodafone from Sir Christopher Gent in 2003, but was beaten to the post by Arun Sarin.
But conditions in Europe were "challenging", the firm said. Pressure from competitors and regulators had pushed prices down by 15.8%. Since his appointment as deputy chief executive in 2006, 46-year old Mr Colao has run Vodafone's European operations.
During his career, he has worked for investment bank Morgan Stanley, consultants McKinsey & Co and the Milan-based RCS MediaGroup.