By Tom Käckenhoff and Maria Sheahan
DUESSELDORF/FRANKFURT (Reuters) - Shares in Thyssenkrupp jumped on Friday after Chief Executive Heinrich Hiesinger unexpectedly offered to step down, clearing the way for a radical restructuring of the group.
Hiesinger's resignation comes less than a week after he sealed a landmark joint venture deal with India's Tata Steel, the culmination of two years of negotiations that in the end came too late to placate investors hungry for change.
His move creates a power vacuum as Thyssenkrupp prepares to present a revamped strategy for the group, which was forged by the merger of two German steel groups founded in the 19th century and currently spans submarines, elevators and car parts.
Chief Financial Officer Guido Kerkhoff is a likely interim CEO.
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"I have not taken this decision lightly - quite the opposite," Hiesinger wrote in a letter to staff. "I take this step very consciously to enable a fundamental discussion in the supervisory board on the future of Thyssenkrupp."
Activist shareholders Cevian and Elliott have both criticised Thyssenkrupp's performance under Hiesinger, with shares down 28 percent since he took office in January 2011.
On Friday, the stock jumped as much as 6.6 percent to the top of the pan-European STOXX Europe 600 index before giving up some of its gains to trade 2.4 percent higher by 1040 GMT.
BOARD MEETING
Cevian is Thyssenkrupp's second-biggest shareholder after the Krupp family foundation, with around 18 percent of the company and a seat on the supervisory board. Elliott has under 3 percent, according to its latest filing.
Thyssenkrupp's supervisory board was due to meet on Friday to take a decision on Hiesinger's request, with no obvious permanent successor in view.
"Now there is an opportunity to develop a new strategy, to advance restructuring and to reposition the group," said Ingo Speich, fund manager at Union Investment, which holds about $28.5 million worth of Thyssenkrupp stock.
"A successor should therefore add a new perspective rather than hold on to the existing strategy," he added.
Breaking up conglomerates is tougher in Germany than, for example, in the United States, mainly because of the power of labour unions on German company boards.
The resignation was the fourth by a German blue-chip company's CEO in as many months, after the chiefs of Deutsche Bank, Volkswagen and Beiersdorf.
SUPPORT WANES
Hiesinger, 58, was brought in to turn around Thyssenkrupp seven years ago after it lost billions of euros in an ill-fated venture in the Americas that forced his predecessor Ekkehard Schulz to step down.
The former Siemens executive vowed to fix the "disaster" at the group, axing half his management board amid losses and corruption allegations.
He presided over Thyssenkrupp's protracted exit from its volatile steel business, whose roots go back more than 200 years and provided the company's backbone for many generations.
But his shareholder backing dwindled during his quest to simplify the group's structure while still keeping it intact.
A person familiar with the matter told Reuters that Cevian partner Jens Tischendorf and former Deutsche Telekom Chief Executive Rene Obermann voted against the deal with Tata, while HSBC Germany chief Carola von Schmettow abstained at last week's board meeting.
Some key shareholders said the terms of the Tata deal were not favourable enough and that Hiesinger could have sought a better deal.
($1 = 0.8543 euros)
(Additional reporting by Christoph Steitz; Writing by Maria Sheahan; Editing by David Evans/Keith Weir/Georgina Prodhan)
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