E.ON moves forward with transformation: key organizational and personnel decisions made

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27 aprile 2015

  • Supervisory Board names future leadership teams: Johannes Teyssen will remain CEO of E.ON, Klaus Schäfer will be CEO of the new company
  • Michael Sen, currently CFO of Siemens Healthcare, will become E.ON’s CFO effective June 1, 2015
  • The new company will be called Uniper
  • E.ON will have its headquarters in Essen, Uniper in Düsseldorf

New management structures with four board functions

As part of its transformation, E.ON today made key organizational and personnel decisions. In the five months since announcing its new strategy, E.ON thoroughly discussed the main aspects of the organizational architecture for the future E.ON and the new company and has now reached decisions. It also defined new management structures for them that reflect their respective strategic challenges. Under these structures, both companies will have four Management Board functions: a CEO, a CFO, and two operating functions.

The future E.ON will have a Chief Markets Officer (CMO) who will oversee the development of new products and innovative solutions as well as the renewables business, which will be directly integrated into the company’s future portfolio of products and services. A Chief Regions Officer (CRO) will be responsible for the existing sales and distribution network businesses in E.ON’s various national markets. The new company will have a Chief Operating Officer (COO), who will oversee the operation of technical assets, and a Chief Commercial Officer (CCO), who will be responsible for marketing the company’s production and for energy trading.

Werner Wenning, Chairman of the E.ON Supervisory Board, said of today’s decisions: “The Supervisory Board is convinced that the new management structures will enable the Group’s businesses to meet the enormous challenges in both energy worlds.“

E.ON’s new setup

E.ON aims to be customers’ partner of choice for innovative energy solutions. To achieve this aim, it will focus on three core businesses: renewables, energy networks, and customer solutions. The interplay between these businesses will enable E.ON to package solutions for the new energy world, such as sustainable offerings for cities and custom-tailored products and services for industrial customers. In addition, it will develop and expand its activities in marketing, technical innovation, digitalization, and energy solutions; these activities will be centrally managed under the leadership of a new Management Board function. The company’s global renewables business, which is managed by E.ON Climate & Renewables, will be further strengthened. E.ON will manage its distribution-network and sales operations through regional units that are close to their markets and customers. “The new setup will enable us to optimally meet customer needs in a rapidly changing energy world. This will directly benefit our 32 million customers in Europe,” said Johannes Teyssen, who will be CEO of E.ON in its future guide as well.

The new company will begin operations on January 1, 2016, as Uniper

The new company, whose core businesses are conventional power generation, energy trading, and exploration and production (E&P), will begin operations at the start of 2016 under the name “Uniper.” The name, which stands for “unique performance,” underscores the company’s outstanding capabilities and expertise. It was suggested by an employee and emerged as the winner over the roughly 3,000 ideas considered. This employee has been with the company for many years and works at a subsidiary that will be part of Uniper.

“Uniper is a superb name for the new company, as was shown by the tests we conducted in numerous target markets,” Johannes Teyssen said. “This brand will help sharpen the new company’s profile and enhance its appeal to customers, business partners, and employees.“

The spinoff encompasses E.ON’s activities in the conventional energy world, from technical asset management to energy trading. These activities will be closely meshed and managed from a single location by means of an integrated management model. “Our objective is to achieve a high degree of efficiency and flexibility and to optimally market our portfolio of assets—from power stations and gas storage facilities to LNG terminals and pipelines—in all our markets. We’re creating a lean organization with short decision-making pathways so that we can respond successfully to future market needs,” said current E.ON CFO and designated Uniper CEO Klaus Schäfer.

Supervisory Board names E.ON leadership team

At its meeting today, the E.ON Supervisory Board made decisions about the planned distribution of Board roles and appointed E.ON’s future leadership team.

Johannes Teyssen (55) will remain E.ON CEO after the spinoff. E.ON’s operating businesses will be led by Leonhard Birnbaum (48) and Bernhard Reutersberg (61). As Chief Regions Officer (CRO) Birnbaum will be responsible for the businesses in E.ON’s core markets and thus for its sales customers and its network operations. Under his leadership, the company intends to further strengthen its market activities in Germany, the United Kingdom, Sweden, the Czech Republic, Slovakia, Hungary, and Romania. Reutersberg, whose service agreement was extended to 2017, will serve as Chief Markets Officer (CMO) and propel the development of innovative customer solutions and manage E.ON’s renewables businesses.

New on the Management Board will be future CFO Michael Sen (46), who will take over Klaus Schäfer’s responsibilities effective June 1. Sen, who was born in the Rhineland region of Germany, has worked at Siemens for almost 30 years. After completing a commercial apprenticeship at the power engineering factory in Berlin and earning a master’s degree in business administration, he has held a variety of management roles in both operations and strategy, including being responsible for international portfolio strategies at Siemens’s Corporate Development and later serving as Head of Investor Relations at Siemens AG. He is currently the CFO of Siemens Healthcare, which has approximately 43,000 employees worldwide and generated about €12 billion in sales in 2014.

“We’re pleased to be bringing on board Michael Sen, who will be an outstanding CFO for the future E.ON. This also means that the entire new leadership team—Johannes Teyssen, Michael Sen, Leonhard Birnbaum, and Bernhard Reutersberg—will soon be ready to move E.ON’s transformation swiftly forward,” Wenning said. “Jørgen Kildahl, who has been a member of the Management Board for many years, will remain in charge of E.ON’s businesses outside Europe—the activities in Russia, Brazil, and Turkey—as well as the E&P business until September 30, 2015. By mutual consent, at that time Mr. Kildahl will leave the company to be able to take on new responsibilities outside the E.ON group.” Wenning continued. “At the start of the year Mike Winkel informed the Chairman of the Supervisory Board that for very personal reasons he would not be available for an extension of his service on the Board of Management. In view of the upcoming reorganization of E.ON and Uniper, Mr. Winkel and the Supervisory Board agreed, by amicable and mutual consent, that he will end his service on the Board of Management effective May 31, 2015.“ The Supervisory Board respects their decisions, regretfully agreed to end their service on the Board of Management, and thanks both for their many years of successful work at the E.ON Group.

Personnel decisions made for Uniper as well

In addition, the Supervisory Board appointed members to future Uniper’s Management Board. Klaus Schäfer (47) will lead the company as CEO. He became E.ON’s CFO in 2013 and has held a wide variety of leadership roles in his nearly 20-year career with the company, including Head of Corporate Strategy in Düsseldorf, CEO of E.ON’s power generation and sales business in Italy, and most recently CEO of E.ON Ruhrgas and E.ON Global Commodities. In the interim, Schäfer will remain a member of the E.ON Management Board and lead key elements of the future Uniper’s business until the company is established. “Klaus Schäfer’s extensive experience—particularly in the future Uniper’s core businesses—and his many years of service at the E.ON Group make him the most suitable candidate for CEO, and we’re pleased to have him,” Wenning said.

Christopher Delbrück (48) will be Uniper’s CFO. Delbrück, who has a degree in economics, began his professional career in 1995 as a consultant at Boston Consulting Group, mainly in its energy practice. He joined the E.ON Group in 2002. As CFO of E.ON’s Swedish subsidiary he was responsible for its integration into the E.ON Group. Delbrück later became CFO of E.ON Energy Trading and E.ON Ruhrgas, playing a key role in their merger in 2012 to form E.ON Global Commodities, which he has led as CEO since 2013. Eckhardt Rümmler (55) will be Chief Operating Officer (COO) and oversee Uniper’s technical assets, in particular its conventional power plants and gas storage facilities. Rümmler has a degree in engineering and almost 30 years of experience in the energy industry. After serving in many roles across the generation business and as Head of Corporate Strategy at E.ON, he is currently CEO of the company’s conventional and renewable power business. A Chief Commercial Officer (CCO), who will be responsible for all marketing activities and for global energy trading, will be added to the team in the months ahead.

“It’s good that with Klaus Schäfer, Christopher Delbrück, and Eckhardt Rümmler we’ve designated a strong and proven leadership team for Uniper. This will make it possible to give Uniper an optimal setup in the months ahead, enabling it to meet its ambitious timetable and begin operations on January 1, 2016,” Wenning said.

Decision made on company headquarters: each company’s central corporate functions will be concentrated in a single city

Employee representatives were involved in an intensive process in recent months to explore where to locate the two companies’ headquarters. The main objective was to offer both companies and their employees the best possible work environment. Another consideration was to minimize the burden of longer or new commutes. The result is a clear solution that also factors in the technical restrictions of the company’s existing office buildings, while addressing employees’ interests. All of E.ON headquarters functions will be located at the company’s Brüsseler Platz office tower in south Essen, which will provide an optimal work environment for all staff in the Rhine-Ruhr region assigned to the future E.ON. There is also the possibility that it could house an R&D team for product innovation.

Uniper will take over all offices in Düsseldorf currently used by E.ON and will have its headquarters in the city’s harbor district. This office building and the current corporate headquarters at E.ON-Platz will house Uniper’s main management units as well as its administrative and support functions. The company’s engineering activities and asset services will remain in Gelsenkirchen, its nuclear energy unit and IT services in Hanover.

“We didn’t take this decision lightly, in particular since it deviates somewhat from our original expectations. But in the interests of our employees and the efficiency of both companies, we and the Groups Works Council agreed on this plan as the best solution. The main priority of everyone involved was for as few employees as possible to face longer commutes. We also believe that proximity will help both companies develop their own corporate culture and identity,” Teyssen said.

New setup will continue to take form in the second half of 2015

The legal groundwork for the new setup will be laid in the second half of the year. Those business operations that will be assigned to Uniper will be carved out and combined in a single entity. Uniper, led by the above-named Management Board, will assume responsibility for these operations effective January 1, 2016. At the 2016 Annual Shareholders Meeting on June 8, 2016, the E.ON Management Board will ask shareholders to approve spinning off a majority stake in Uniper to E.ON shareholders. Shareholders and investors’ invitation to the 2016 Annual Shareholders Meeting will include comprehensive information about the spinoff.

“It’s good that together we and the Supervisory Board have put in place important elements of the new setup and made key decisions in time for this year’s Annual Shareholders Meeting. The implementation of E.ON’s of new strategy is right on schedule and we can present this to our shareholders at the Annual Shareholders Meeting next week,” Teyssen emphasized.

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