With Nokia World 2010 just days away, the Finnish company has announced that CEO Olli-Pekka Kallasvuo has been replaced by ex-Microsoft Business head Stephen Elop. The change - which will take place on September 21st - will also see Kallasvuo cede his position on the Nokia Board, though he will have his non-executive chair of the Nokia Siemens Networks board and a €4.6m severance package to cheer him up.
Olli-Pekka Kallasvuo has been the subject of prolonged speculation regarding his tenure at Nokia, with rumors resurfacing back in July that the company's board was actively looking for his replacement. Nokia has been accused of losing its direction among strong competition from upstart rivals such as Apple, and has been attempting to shift its focus to better deal with the evolving marketplace. According to Jorma Ollila, Chairman of the Nokia Board of Directors, "the time is right to accelerate the company's renewal; to bring in new executive leadership with different skills and strengths in order to drive company success."
Canadian Stephen Elop, meanwhile, brings with him a track record in companies such as Macromedia and Adobe before his Microsoft role, and originally trained in computer engineering and management. According to Microsoft, Elop is leaving his current post effective immediately. We'll hopefully find out more about the changeover at Nokia World on Tuesday.
Nokia appoints Stephen Elop to President and CEO as of September 21, 2010
September 10, 2010
Espoo, Finland -Nokia's Board of Directors has appointed Stephen Elop President and Chief Executive Officer of Nokia as of September 21. Elop currently heads Microsoft's Business Division. Before joining Microsoft, Elop held senior executive positions in a number of US-based public companies, including Juniper Networks, Adobe Systems Inc. and Macromedia Inc. He holds a degree in computer engineering and management from McMaster University in Hamilton, Canada, which is his home country.
"The time is right to accelerate the company's renewal; to bring in new executive leadership with different skills and strengths in order to drive company success. The Nokia Board believes that Stephen has the right industry experience and leadership skills to realize the full potential of Nokia. His strong software background and proven record in change management will be valuable assets as we press harder to complete the transformation of the company. We believe that Stephen will be able to drive both innovation and efficient execution of the company strategy in order to deliver increased value to our shareholders," said Jorma Ollila, Chairman of the Nokia Board of Directors.
Elop commented on his new Nokia position: "I am extremely excited to become part of a team dedicated to strengthening Nokia's position as the undisputed leader of the mobile communications industry, with a relentless focus on meeting the needs and expectations of customers. Nokia has a unique global position as well as a great brand upon which we can build. The company has deeply talented and dedicated people, and I am confident that together we can continue to deliver innovative products that meet the needs of consumers. The Nokia slogan clearly states our key mission: Connecting People, which will acquire new dimensions as we build our portfolio of products, solutions and services."
Olli-Pekka Kallasvuo will leave his current position as President and CEO of Nokia on September 20, 2010 and his position on the Nokia Board of Directors with immediate effect. He will continue to chair the Board of Nokia Siemens Networks in a non-executive capacity.
"The whole Board of Directors joins me in thanking Olli-Pekka for his thirty years at Nokia, during which he has been deeply involved in developing the company and its operations. His dedication and contribution throughout the years has been exceptional. The Board wishes him every success in his future pursuits," says Jorma Ollila.
In accordance with the terms and conditions of his service contract, Kallasvuo is entitled to a severance payment consisting of 18 months gross base salary and target incentive which totals approximately 4.6 million euro. He will also receive as compensation the fair market value of the 100 000 restricted Nokia shares granted to him in 2007, which vest on October 1, 2010.
As of September 10, 2010, the Nokia Board will consist of the following members: Jorma Ollila (Chairman), Dame Marjorie Scardino (Vice Chairman), Lalita D. Gupte, Bengt Holmström, Dr. Henning Kagermann, Per Karlsson, Isabel Marey-Semper, Risto Siilasmaa, Keijo Suila.
A press conference will be held today at Nokia's head office in Espoo, Finland, at 13:00 (CET+1). The press conference will be webcast live via: www.nokia.com/press or http://www.nokia.com/press/media_resources/audio/nokia-webcasts.