LONDON (Reuters) - BAE Systems BAES.L has appointed Centrica's Roger Carr to be its new chairman, placing its trust in the 66-year-old British business veteran to steer Europe's biggest defence contractor through a time of shrinking budgets in the United States and Britain.
Carr will leave UK energy group Centrica CNA.L, where he has been chairman for the last nine years, and will take over as BAE chairman in the first quarter of next year from Dick Olver, who oversaw BAE's ill-fated $45 billion attempt to merge with Franco-German aerospace giant EADS EAD.PA
He will first join the board as a non-executive director and chairman designate on October 1 this year, the company said. Carr will step down as Centrica’s chairman on or before the company’s annual general meeting in 2014.
“Sir Roger was the clear choice,” said BAE’s senior independent director, Nick Rose, who led the search.
“He is an outstanding candidate with two decades’ board-level experience at the top of UK industry. His skills, reputation and relationships with investors and government ministers will be of considerable value to the company both at home and abroad,” he said.
Having first worked as a computer programmer at Boots, the Nottingham native made his name as a dealmaker as chief executive of now-demerged British security group Williams Holdings before chairing utility Thames Water and pub group Mitchells and Butlers MAB.L.
His latest deal was in 2010 when he chaired chocolate maker Cadbury during its 11.9 billion pound takeover by U.S. food giant Kraft Foods Group Inc KRFT.O, which was strongly criticised among the British public.
Carr is also the outgoing chairman of UK lobby group the Confederation of Business Industry, which represents about 240,000 companies.
BAE is combating declining spending from its biggest customers, the United States and Britain, and has focused on overseas sales and niche sectors such as cyber security to boost growth following the failed attempt to merge with Airbus-owner EADS, which would have given it a commercial edge.
Carr’s predecessor Olver came under fire from some of the company’s biggest shareholders such as Invesco Perpetual and Henderson Global Investors, which said the collapsed deal was symptomatic of a wider and sustained failure to create value for shareholders.
Carr’s career has been largely based in the UK, and some industry insiders say he lacks the international experience to negotiate the foreign deals that are a growing part of BAE’s business.
The company, which posted a 6.4 percent fall in 2012 earnings in February, is still negotiating with Saudi Arabia over the pricing of a crucial Eurofighter jet deal and hopes to edge back into a fighter jet competition in India which it has so far lost to Dassault Aviation's AVMD.PA Rafale aircraft.
BAE said on May 8 that there was still insufficient detail to gauge the impact of U.S. government cuts on defence spending, known as sequestration, which began in March and have already caused some contracts to be delayed.
Reporting by Brenda Goh; editing by Rhys Jones and Tom Pfeiffer
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