Change of guard at Voda as Sarin steps down

Vodafone chief Arun Sarin is to step down from his post after five years at the helm.

The announcement came as the world’s biggest operator by revenue reported a profit of £6.7bn for the year to end March 31, versus a loss of £4.8bn in the previous year.

Revenues also jumped 14.1 per cent year on year to £35.5bn, with data revenues up 40.6 per cent on an organic basis to £2.2bn, driven by strong growth in mobile data cards. Voda counted 5.8 million wireless broadband users at the end of the financial year.

Sarin will be replaced by deputy chief executive Vittorio Colao and while analysts said they were not surprised by the choice, many found it to have come earlier than expected.

Having survived a boardroom fracas and shareholder dissent in 2006, the Indian born American turned his fortune around in 2007 with his strategy of moving Vodafone into India to offset the slowing growth in its mature businesses.

The 53 year old head honcho, who was recently listed as the most powerful person in British telecoms and technology, intends to take a sabbatical, possibly returning to the west coast of the US.

“I feel that I have accomplished what I set out to achieve, particularly in developing and implementing a new strategy…I know that the business is in capable hands with Vittorio Colao,” Sarin said.

The change of guard will take place July 29.

John Delaney, analyst with IDC, said, “In the end, it turns out that Arun Sarin’s forte was the long game. After five years as the frequently beleaguered CEO of the Vodafone Group, Arun Sarin goes out on a high note.

The most remarkable thing about this stately transfer of power in a well-run kingdom is that it feels entirely predictable. It’s not an outcome that many people would have bet on 18 months ago. Arun Sarin has had a torrid time of it during much of his tenure as CEO. The basic problem he has had to deal with is that it is easier to command affection and respect by building an empire, than by managing one. His predecessor Chris Gent was the empire-builder par excellence, and is still best known today as the hero of the battle of Mannesmann – nothing is more endearing to the British public than thrashing the Germans, however long ago. By contrast, Sarin’s image was damaged early on by the failure of a move to extend Vodafone’s reach by acquiring control of US operator AT&T Wireless. The nadir of his reign came in 2006, when Vodafone announced the biggest loss in UK corporate history (ironically, a delayed result of the Mannesmann acquisition) and 14% of investors failed to vote confidence in Sarin at the company’s AGM. And then, it all started to come good. The turning point was in early 2007, when Vodafone acquired the Indian operator Hutchison Essar. Sarin’s reputation was enhanced greatly by both the substance and the style of this acquisition.”