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BP Taps Ericsson’s Svanberg as Chairman

BP PLC said Thursday that it appointed Carl-Henric Svanberg, chief executive of Swedish telecommunications-equipment maker Telefon AB L.M. Ericsson, as its chairman, finally bringing to an end the protracted search for a replacement for current Chairman Peter Sutherland.

[Carl-Henric Svanberg]AFP/Getty Images 

Carl-Henric Svanberg

The move mirrors the appointment of Jorma Ollila, then CEO of Finnish mobile-handset maker Nokia, as chairman of Royal Dutch Shell PLC, BP’s rival, in August 2005.

It shows how eager western majors are to position themselves as technology companies rather than straight-forward oil-and-gas producers, especially at a time when Big Oil is under pressure to help fight global warming by investing in green energy and high-tech solutions to climate change such as carbon capture and storage.

But the choice of someone from outside the energy industry, with no experience of running a major oil-and-gas company could raise some shareholders’ eyebrows.

The process of finding a replacement for Mr. Sutherland suffered a setback last year when BP shareholders came out against one of the leading candidates, Paul Skinner, then chairman of miner Rio Tinto PLC, because of his support for Rio’s $19.5 billion fund-raising deal with Aluminum Corporation of China Ltd.

Mr. Svanberg, 57, who is also chairman of Sony Ericsson and a nonexecutive director of Melker Schörling AB, will join the BP board as chairman-designate and a nonexecutive director on Sept. 1, 2009, the company said in a statement. He will succeed Mr. Sutherland as chairman on Jan. 1, 2010.

BP CEO Tony Hayward called Mr. Svanberg “a businessman of international stature who is recognized for his transformation of Ericsson.”

“Our shared views on many aspects of global business give me great confidence that we will work very effectively together on the next phase of BP’s progress,” he said in a statement.

Since Mr. Hayward took over as CEO of BP in 2007, he has embarked on a major restructuring of the company with the aim of trimming costs and improving safety and efficiency. “We are coming to the end of chapter one, restoring the fortunes and financial performance of BP,” Mr. Hayward said. “Carl-Henric is coming in as we embark on chapter two … creating a 21st century company.”

Ericsson said Mr. Svanberg will be succeeded by Finance Chief and Executive Vice President Hans Vestberg. Mr. Svanberg will remain on the Ericsson Board. Major shareholders InvestorAB and Industrivarden AB have said they want him to remain as a board member long-term.

—James Herron and Dominic Chopping contributed to this article.Write to Guy Chazan at [email protected]

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