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UPDATE 2-Nokian Tyres names interim CEO, may postpone plant decision
December 21, 2016 / 9:10 AM / a year ago

UPDATE 2-Nokian Tyres names interim CEO, may postpone plant decision

* Head of Russia business named interim CEO

* Chairman says looking externally for permanent CEO

* Says some issues need clarifying on new plant plans (Adds comments from chairman, executive and analyst)

By Jussi Rosendahl and Tuomas Forsell

HELSINKI, Dec 21 (Reuters) - Finland’s Nokian Tyres appointed the head of its Russian operations as interim chief executive on Wednesday, and indicated its decision on a new plant could be postponed.

The company, one of Europe’s most Russia-exposed firms due to its large tyre plant near St Petersburgh, is losing current CEO Ari Lehtoranta to another Finnish company, creating uncertainty about the tyre maker’s strategy.

Andrei Pantioukhov, the general manager of Nokian’s Russian operations, will start as interim CEO from the beginning of January.

Pantioukhov was viewed by analysts as the best insider candidate, but he told a conference call on Wednesday he was not being considered for the role permanently due to family reasons.

Board chairman Petteri Wallden said the company was looking for external candidates.

The process may have complicated the company’s plans for a third tyre factory, one analyst said.

Nokian had previously said it would announce by the end of this year whether it would proceed with a plan to build a third tyre factory.

Asked about this, Wallden told the conference call that the project had to be “prepared properly.”

“We had a long discussion in the December (board) meeting. There are some issues we want to clarify more, but the project is going on as normal business.”

Jukka Oksaharju, strategist at Nordnet brokerage, said it sounded like the company was pushing back the project.

“Perhaps they are waiting for the (CEO) successor to have an influence ... But it is clear that they will need the new capacity and I expect it will come to North America.”

Nokian’s sales were hit by the Ukraine crisis, a slowdown in the Russian economy and a weakening of the rouble, but the company has this year managed to offset lost business by growing in North America and Central Europe.

Nokian was ahead of Western rivals Michelin and Continental in establishing a large factory in Russia, which has been a prime market for Nokian’s mainstay products, high-margin winter tyres.

At 1135 GMT, its stock was down 0.2 percent at 35.22 euros. (Editing by Mark Potter)

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