By Christina Zander
STOCKHOLM-- Electrolux AB failed on Thursday to quash
speculation about an imminent management shake-up at Europe's
largest home-appliance maker, saying that its American chief
executive had not resigned but adding that it was working on
succession plans.
The possible departure of Keith McLoughlin could leave the
Swedish giant without strong leadership at a time when the company
is seeking to close the $3.3 billion purchase of General Electric
Co.'s appliances business.
Talk that Mr. McLoughlin could leave was ignited by a report in
Swedish daily Dagens Industri which said that the CEO had informed
the Electrolux board of his desire to step down. The report added
that Electrolux was considering offering the job to Charles
Blankenship, who heads GE's appliance business.
Mr. McLoughlin and spokespeople at GE's appliance unit, did not
respond to emails seeking comment.
Electrolux shares were changing hands at 262.40 kronor ($31.84),
down 2.2% in mid-afternoon trade on Sweden's stock exchange, with
analysts citing concerns over a possible management vacuum at a
sensitive time for the company.
The GE Appliances acquisition, which is expected to close later
this year, will put Electrolux head-to-head with the industry
leader, Whirlpool Corp of the U.S. The merger is expected to
generate synergies of $350 million over the next few years.
Electrolux is also in the process of turning around its own
North American arm, which is run by Mr. McLoughlin after the head
of the unit left the company in April. The unit's poor performance
led Electrolux to issue a profit warning in the spring, and
eventually post a 21% drop in first-quarter net profit.
Mr. McLoughlin, who joined Electrolux in 2003, became chief
executive in 2011. His appointment was riddled with controversy in
Sweden over what was seen as his hefty paycheck, one of the
country's highest.
Since January, he has been staying at Stockholm's Grand
Hôtel--one the city's fanciest buildings with a view of the Royal
Palace--after the lease on his apartment ran out at end of
2014.
Write to Christina Zander at christina.zander@wsj.com
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