LG Electronics replaces CEO in management reshuffle

SEOUL (Reuters) - LG Electronics replaced on Monday its chief executive and other senior officials in a management reshuffle that analysts say is aimed at bringing in momentum to its stalled handset and display businesses.

The moves come as LG reported disappointing handset sales this year and struggles with falling flat-panel prices. Analysts are worried that fourth-quarter earnings could worsen from the third due to weak panel prices and the stronger won currency.

Nam Yong, former vice chairman of LG and CEO of LG Telecom, will become LG Electronics' new CEO and vice chairman, the company said in a statement.

Nam replaces Kim Ssang-su, who had headed the country's top home appliance maker since 2003.

LG Electronics also promoted James Jeong, former head of corporate finance at the company, to replace chief financial officer Kwon Young-soo.

It also appointed Skott Ahn and Simon Kang as the new heads of its mobile communications and display businesses, respectively.

Media reports said on Monday Kwon was set to take the chief executive role at LG Electronics' loss-making flat-screen venture, LG.Philips LCD, LG.Philips could not confirm the reports.

"It appears the selection of Nam, former LG Telecom CEO, reflects pressure from the market to improve LG's handset business," said Kevin Lee, an analyst at Woori Securities.

However, many still remain sceptical about the reshuffle's impact on the company.

"We don't think one CEO will change the picture. If he had experience in running a global company, we'd be more confident," said Thomas Choi, head of research at PCA Asset Management.

LG was the world's fourth-biggest handset maker in 2005 but slid to the No. 5 spot in the third quarter, hit by fierce competition for price and design with Nokia and Motorola.

It was the largest plasma display panel (PDP) maker in the third quarter, overtaking 2005's No.1 Samsung SDI, but is facing dropping panel prices and tough competition from liquid crystal display (LCD) technology.

Shares in LG, also the world's biggest home-use air conditioner maker, rose 0.91 percent to 55,200 won by 0540 GMT, against the wider market's 0.54 percent gain.