August 1, 2005

Nokia's long-time chief executive announced he will step down next year, paving the way for Nokia's Olli-Pekka Kallasvuo to take the helm.

Investors appeared to take the news in stride; the company's stock was down slightly after the announcement to $15.88 per share.

Kallasvuo, 52, is the head of Nokia's mobile-phone business. Beginning next year, he will become the company's president and chief operating officer, and in June he will take over the CEO role.

He will replace Jorma Ollila, Nokia's CEO for 13 years, who will continue to serve as the company's non-executive chairman. Ollila is 54 years old.

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Kallasvuo joined Nokia in 1980 as corporate counsel. In 1987, he was appointed assistant vice president for the company's legal department, and in 1988, he became the assistant vice president of finance. By 1990, he was promoted to senior vice president of finance.

In 1992, Kallasvuo ascended to the company's senior ranks as chief financial officer. Then, from 1997 to 1998, he got a taste of the business end of things as corporate executive vice president of Nokia's Americas operations. He then returned to the CFO position in 1999. He headed Nokia's phone business starting last year.

Prior to joining Nokia, Kallasvuo held a variety of positions with the Union Bank of Finland. He holds a master's degree in law from the University of Helsinki. According to his biography on Nokia's Web site, Kallasvuo enjoys golf, tennis and reading about political history.

"The Nokia board has had in place a succession process in anticipation of Jorma Ollila's retirement with the objective of maintaining vitality, adapting to a rapidly evolving industry, and ensuring continuity," said Paul Collins, vice chairman of the company's board.

"The board is convinced that Olli-Pekka Kallasvuo, with his strong industry credentials and over 20 years of experience at Nokia, will provide the required leadership for the company in the future."

Kallasvuo will helm the world's largest mobile-phone maker. However, he jumps in at a critical time-industry watchers have criticized Nokia for a relatively unexciting line-up of phones.

Further, No. 2 phone vendor Motorola Inc. has recently scored major gains in the low-end phone market-Nokia's turf-and has set its sights on the No. 1 position. Kallasvuo will run up against Motorola's newly installed CEO Ed Zander.

Interestingly, Ollila is one of only a few leaders of the largest telecom companies that weathered the telecom downturn a few years ago.

Source: RCR News