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NEWSMAKER-Eick rings changes to call the tune at Arcandor

Published 12/03/2008, 09:59 AM
Updated 12/03/2008, 10:02 AM

By Nicola Leske

NEUBIBERG, Germany, Dec 3 (Reuters) - Karl-Gerhard Eick, picked on Wednesday to take the helm at German tourism and retail group Arcandor, is at last shedding his reputation as the crown prince of Germany's business community.

After nine years of being passed over for the top job at Deutsche Telekom, where he served as finance chief, Eick finally called it quits.

Arcandor's shares jumped on the news and many analysts applauded the move.

"Eick has earned himself an excellent reputation at Deutsche Telekom and, in particular, he steered the company through the financial crisis at the beginning of this decade very well. This knowledge could prove very valuable for Arcandor," LBBW analyst Hans-Peter Kuhlmann said.

The scale of Eick's new challenge was underlined by Heino Ruland at FrankfurtFinanz, who quipped that "you have to be drunk to voluntarily take the helm at Arcandor."

The company owns ailing department store chain Karstadt and has been under pressure from banks to sell its profitable travel arm Thomas Cook.

But Eick, 54, is used to pressure.

Called Karlchen -- "Little Karl" in German -- by former Deutsche Telekom head Kai-Uwe Ricke, the 6-foot-plus Eick helped reduce Deutsche Telekom's huge debt burden in 2003 and 2004.

Born in Ulm in Swabia -- a southern German region with a reputation for stinginess -- Eick liked to quip that saving money was part of his nature. "And I see nothing wrong with that."

Under Ricke's predecessor Ron Sommer he helped buy U.S. wireless company Voicestream. Criticised at the time as too expensive, the deal was later seen as a clever move that helped turn Deutsche Telekom's mobile business into a growth driver.

Eick was one of the board members spared the axe when Rene Obermann took over as head of Telekom in November 2006 and faced the heat for approving financial targets that later resulted in a profit warning.

FINANCES AND BEETHOVEN

A meticulous dresser even when he wears Lederhosen -- traditional Bavarian men's dress -- at the annual Oktoberfest beer festival in Munich, Eick keeps himself fit running and skiing.

He has a reputation for being a calm and dedicated worker with a good dose of ambition mixed in.

"His organisation is founded on loyalty and he likes the good things in life and knows how to get them," a person who has worked closely with him for years said.

"He runs his shop like a king," this person added.

With a degree in business administration from Augsburg University in southern Germany, Eick started his career as a controller at German premium carmaker BMW.

After a stint at household wares group WMF and at optical group Carl Zeiss AG, he joined drugs wholesaler Gehe, now called Celesio and part of the privately owned Haniel group.

Eick was regarded as a CEO-in-waiting at Gehe, but much to the industry's surprise he joined Deutsche Telekom as finance head in 2000 instead.

Eick is not just a numbers man. He is an avid piano player with a fondness for Germany's greatest composer, Ludwig van Beethoven.

According to Russian pianist Pavel Gililov, the city of Bonn, the birthplace of Beethoven, has Eick to thank for its 'Beethoven Competition', which is sponsored by Telekom and carries a prize of 30,000 euros.

(Editing by John Stonestreet)

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