Sunrise and CEO Swantee abruptly part ways

Sunrise has entered 2020 with the surprise announcement that Olaf Swantee, previously one of the favourites to take over the top-job at BT, will no-longer be CEO.

The abrupt nature of the announcement is of course not the usual course of action from a shift in management, though Swantee will remain in a support role until the Annual General Meeting in April. CFO André Krause has been promoted to CEO with immediate effect.

Details on the reason for a change in management are non-existent for the moment, though there will be plenty of rumours. Traditionally, telcos announce a CEO will be stepping down in ‘X’ number of months’ time, allowing a transition period through to a named replacement. Stating Swantee has resigned with immediate effect is unusual and suggests there is more to the story.

This is speculation however; there might not be a grand conspiracy theory, this might just be way the Swiss like to do business.

Swantee joined Sunrise in 2016 as CEO, having served as the CEO of EE in the UK for more than five years. His time at EE was a very successful one, taking over as CEO in the months following the formation of the company as a joint-venture between Deutsche Telekom and Orange. Over the course of the five-year period, Swantee oversaw the integration of the two existing businesses, as well as led EE to a leadership position in the UK market.

This success was then taken to Sunrise.

  2018 2019 2020 2021
Mobile subs 2.356 million 2.478 million 2.643 million 2.715 million
Growth 0.29% 5.2% 6.64% 2.72%
Market share 21.8% 23.5% 23.6% 23.8%
Broadband subs 457,000 500,879 461,860 461,660
Growth 8.38% 9.53% -7.79% -0.04%

Figures curtesy of Ovum’s World Information Series

Joining just after the company’s IPO in 2015, Swantee oversaw a transformation in the business, investing in the network while also shifting the brand and company culture. Mobile subscriptions are now on an upward trajectory, broadband is stabilising, and TV is in a healthy position. Sunrise is formulating a challenge to the clear and dominant market leader, Swisscom, and Swantee can leave with his reputation enhanced.

This is perhaps what makes the announcement somewhat of a surprising one; Sunrise are in a healthy position. A new strategy, focused on under-30s, is currently underway, while the business is also gaining traction in the enterprise market. Revenues are heading the right direction, as is share price and dividend payments.

What is worth noting is that there may well have been a bit of friction following the recently aborted acquisition of UPC Switzerland, Liberty Global’s assets in the country. Integrating UPC Switzerland into the Sunrise business would have given a boost to mobile subscriptions, but also a notable injection in the broadband unit; UPC Switzerland’s network currently passes 50% of the homes in the country.

Swantee was the champion of the $6.3 billion acquisition, a move which would have driven through a more complete convergence strategy in the business. However, the move was opposed by the telcos largest shareholder, Freenet, forcing the team to abandon the plans. Perhaps this friction could explain the sudden departure of a successful executive?

Whatever the explanation, Sunrise’s loss is someone else’s gain. Swantee is an experienced executive with a habit of being successful. We suspect that Swantee will not be unemployed for long.