ThyssenKrupp AG chairman Gerhard Cromme admitted yesterday to making mistakes that contributed to massive losses at the German steelmaker, but didn’t bow to pressure from some shareholders to step down.
“If you ask me whether we as a supervisory board could have done things better in the past, then my honest answer is yes, we trusted too long, we could have acted sooner,” he told the company’s annual shareholders’ meeting.
Cromme has come under fire for not stopping a botched multi-billion euro project in the Americas that caused Thyssen to post an annual loss of €4.7 billion and pay no dividend for the 2011/2012 fiscal year.
The euro zone debt crisis has meanwhile hurt demand for cars and weighed on steel prices, causing a slump in profits at Thyssen’s European steel business. The company has €5.8 billion of net debt, almost 1.3 times its equity.
Mr Cromme, also chairman of Siemens AG, continued to put most of the blame for the Americas disaster on former executives and said at the meeting that the supervisory board provided Thyssen with stability.
His comments were greeted by a mix of cheers and boos from a lively audience of several thousand, aware that problems had mounted under Mr Cromme and former chief executive Ekkehard Schulz.
Shareholders taking to the podium at the annual general meeting called Thyssen’s ill-advised investment in the Americas a “disaster” and a sign of a “lack of healthy scepticism” by the board. “Shareholders are shocked about the development of your firm,” Thomas Hechtfischer of shareholder rights group DSW said.
Current chief executive Heinrich Hiesinger, brought in from Siemens by Mr Cromme two years ago, axed half of his management board last month and vowed to do away with self-interested “old boy networks” in the company. He pleaded for shareholders to focus on the company’s future. – (Reuters)
