German telecom Deutsche Telekom (News - Alert) AG announced today the appointment of a new CEO, effective immediately. Forty-three year old René Obermann replaces Kai-Uwe Ricke as head of the company.

 

A Financial Times Deutschland report today said that Ricke was due to step down next year, but the changing of the guard is taking place now because faith in the former CEO “has been lost after poor business development, with the former monopoly being less competitive due to high staff costs and inflexible bureaucracy.”

 

Obermann comes to Deutsche Telekom directly from his former post as head of the mobile division for T-Mobile (News - Alert), Deutsche Telekom AG’s European and American unit.

His leadership, Financial Times said, is one reason why recently “half of the group's profits have been attributed to T-Mobile.”

 

In its announcement, Deutsche Telekom noted that Obermann joined the company’s management board, and assumed responsibilities for T-Mobile, in 2002. He brings more than 20 years of experience in the telecom industry to his new position.

 

It is likely that more staff changes, specifically cuts, are likely in the near future at Deutsche Telekom, Financial Times said. The company employs 244,000 people worldwide, and 32,000 jobs are on the cutting block by 2008.

 

As this article was being published, Deutsche Telekom stocks were trading for roughly $17.28, up just over two percent from closing Friday.