Shenanigans At Infineon

Infineon is a great engineering company hobbled by a shocking bad management.

As Europe's leading semiconductor analyst, Malcolm Penn, CEO of Future Horizons puts it:

"Infineon is a fundamentally great company stuffed full of outstanding people badly let down by appallingly bad management. Schumacher was right to stand up against them; right to walk when he did. The vendetta against Ziebart beggars belief."

On February 11th a new chairman of the supervisory board is to be elected to replace out-going chairman Max Dietrich Kley.

Kley had wanted an old Siemens hand, Klaus Wucherer, to take over.  Wucherer is one of three former Siemens directors who each paid €500,000 to Siemens last year to settle a bribery allegation.

A UK investor, Hermes has put up a rival contender to Wucherer - Willi Berchtold, CFO of auto parts supplier ZK Friedrichshafen which is one of Infineon's customers.

This has provoked an angry response from another of Infineon's customers, Bosch.

So a stormy meeting is expected with investors lining up on either side of the row.

This is highly unusual in German corporate life where such appointments are normally privately stitched up before any vote is taken.

The supervisory board are shockers:

They backed a coup against Infineon's founding CEO Ulrich Schumacher and then supported a legal prosecution against him for bribery  from which Schumacher walked away totally exonerated after the charges were comprehensively dismissed by a Munich judge.

They then orchestrated an unseemly public campaign against Schumacher's successor, the much respected Dr Wolfgang Ziebart, to force him out.

They then flirted with the private equity industry, looking for deals in full knowledge of how disastrous has been the PE industry's ownership of NXP and Freescale.

'A new start at Infineon requires further renewal, particularly at the top of the supervisory board', says Hermes.

How right they are.