Valeo Reshuffles

Chief executive of the auto parts maker quits after differing with the board on strategy.It seems a year of decent share price gains isn't enough for the board of Valeo. The French auto parts maker said Monday that its chairman and chief executive, Thierry Morin, had stepped down because of “strategic differences” with the board, following a steep decline in the company's shares over the last decade and in spite of a recovery for the stock in the last year.

Valeo's shares have climbed by 4.0% in the year to date while other companies in the auto industry have seen their market capitalizations decimated. But analysts cited discontent among shareholders who have watched Valeo's share price fall from around 100.00 euros ($136.67)a decade ago, to only 11.40 euros ($15.60) today.

Morin, who was the company’s chairman for the last eight years, leaves Valeo as of March 20 with the title of honorary chairman "in recognition of his significant contribution to the development of the group," the company said.

Shares of Valeo (other-otc: VLEEY - news - people ) rose 2.4%, or 27 cents (37 cents), to 11.40 euros ($15.60) on Monday morning in Paris.

The company has appointed Jacques Aschenbroich, former deputy chief executive at glass-maker Saint-Gobain, as Morin’s replacement. He is regarded as a relatively efficient manager. "Aschenbroich had quite a good performance at Saint-Gobain in recent years. He turned around parts of the glass sector that were not so favorable in 2001,” said Volker Stoll, an analyst with LBBW.

Valeo was the first company in France to benefit from President Nicolas Sarkozy's strategic investment fund, created to help companies hit by the global economic crisis. The fund bought 2.35% of the group for 19.0 million euros ($26.0 million) last month.

In February Valeo also posted a fourth-quarter loss of 313.0 million euros ($403.7 million), compared with a profit of 50.0 million euros ($64.4 million) the year before. The company said it would propose no dividend for 2008 at its annual general meeting for shareholders.

As supplier to the ailing car industry, Valeo has suffered from a dramatic fall in demand that has led carmakers to slow or temporarily stop production.