Finmeccanica Removes Helicopter Head After Graft Probe Fells CEO
Stock Chart for Finmeccanica SpA (FNC)
Finmeccanica SpA (FNC) delayed publication of its annual earnings and replaced some executives, including the head of the helicopter unit at the heart of a bribery probe that felled Chief Executive Officer Giuseppe Orsi this month.
Financial results, due March 12, may be delayed until April, the company said in a statement late yesterday. The Rome- based company also added members to its so-called surveillance board and tightened its internal audit operations to improve oversight over activities.
“Finmeccanica is determined to continue with the implementation of the restructuring plan of the group, in particular in some areas of activity, in order to achieve a significant and sustainable recovery of profitability and the ability to generate cash flow,” the company said.
Italy’s largest aerospace and defense company has been shaken by the arrest this month of Orsi on alleged fraud and tax evasion related to the sale of 12 AW101 helicopter to India. Orsi, who denies the charges, has since been stripped of his CEO role, which was handed Chief Operating Officer Alessandro Pansa and resigned the chairman title.
Finmeccanica previously announced the goal of raising 1 billion euros ($1.3 billion) through disposals to reduce debt of around 4.8 billion euros. The strategy is again under review even as the process continues to sell the Ansaldo Energia business, with offers now in hand, it said. The “portfolio of activities” is under review, which may led to the “deconsolidation of assets” to cut debt, Finmeccanica said.
Bruno Spagnolini, the head of AgustaWestland who is under house arrest, has been replaced with Daniele Romiti, Finmeccanica said. Other personnel changes include the appointment of Luigi Pasquali as head of the Telespazio space business, replacing Carlo Gualdaroni, and Alessandro Franzoni, who is taking over the torpedo-building Whitehead Sistemi Subacquei unit from Renzo Lunardi.
At a meeting yesterday, the board was presented with a plan for structural changes in the main aerospace, defense and security operations to cut costs. Among those are efforts to streamline European defense electronic activities, including job cuts, as three business units are folded into one.
Finmeccanica also may delay its annual general meeting to approve full year results. The gathering will take place by June 29, the company said.
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