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Deutsche Boerse's chairman signals may not serve full term

Published 05/16/2018, 09:35 AM
© Reuters. FILE PHOTO: Theodor Weimer, CEO of German stock exchange Deutsche Boerse AG, informs the media about the planned renovations at the trading floor of Frankfurt's stock exchange
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FRANKFURT (Reuters) - The chairman of Deutsche Boerse's (DE:DB1Gn) supervisory board said on Wednesday he would not insist on serving another full three-year term amid criticism that he is partly to blame for management missteps.

Shareholder adviser Hermes EOS and other investors have said Joachim Faber should pave the way for a successor after the company's former chief stepped down last year amid an ongoing insider trading investigation.

"I reserve the right to prepare for a transition in the chairmanship of the Supervisory Board during the next term of office," Faber told shareholders at the company's annual general meeting, where he was up for re-election.

Faber didn't elaborate on timing of the transition.

The German stock exchange operator is seeking to open a new chapter after it last year became entangled in the insider trading scandal, a failed merger with London Stock Exchange (L:LSE), and a profit warning.

Theodor Weimer, who took the reins on Jan. 1 as the company's new chief executive, told shareholders that he was on the lookout for acquisitions as one of the pillars of the company's growth strategy.

Acquisitions were "part of our strategy, in particular where it would complement our business", he said.

Acquisition priorities include fixed-income securities, energy products, currencies, services for investment funds, data and indices, he said.

But Weimer also ruled out some mega deals, a year after the collapse of Deutsche Boerse's proposed merger with LSE.

"Transformational transactions, whereby we thereafter no longer hold majority, or our headquarters is no longer in Hesse, are not an option for us," he said.

Soon after taking the helm, Weimer announced that he would review the company's strategy and last month Deutsche Boerse outlined the broad cornerstones of its plans.

Weimer's comments at Wednesday's annual general meeting flesh out that roadmap and further details are expected later this month.

Another pillar of the strategy is organic growth and investment, with Weimer saying that Britain's exit from the European Union offers business opportunities.

Deutsche Boerse aims to win a quarter of the lucrative euro clearing market from London.

"It is up to us, in the interest of our customers, to provide a well-organised transition to a new European market

order," Weimer said.

© Reuters. FILE PHOTO: Theodor Weimer, CEO of German stock exchange Deutsche Boerse AG, informs the media about the planned renovations at the trading floor of Frankfurt's stock exchange

The CEO has also been studying cost cuts and staff reductions. He said that up to 50 management-level staff could lose their jobs.

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