When the two RWE chief executives, Peter Terium and Rolf Martin Schmitz, positioned themselves for a photograph on the top floor of the company headquarters in Essen, Mr. Schmitz pulled Mr. Terium away from the railings.
“Don’t fall down on me, Peter, I still need you,” Mr. Schmitz said.
To which Mr. Terium replied. “Thanks, that’s good to know.”
The two executives find themselves in a particularly delicate situation. Both have put behind them past differences, including a tough boardroom battle for the lead position at RWE five years ago, amid dramatic changes in the energy market.
Germany’s transition to renewables is good news for green energy providers but has led to huge losses and write-downs at traditional utilities. As a result, the country’s biggest power companies are changing their structures, separating new and old businesses.
Mr. Terium has been leading embattled RWE, Germany’s biggest electricity provider and second-largest utility, through troubled times. The company posted a loss in 2015 and canceled its dividend, disappointing shareholders. He set the company’s radical cost-cutting targets, which he raised again this year.
Mr. Schmitz, who is now responsible for the part of the business encompassing traditional power sources, came to RWE in 2009, after many years at rival E.ON.
Despite their clashes over the top job, the two executives are now united in their efforts to make the two new parts of the former RWE Group a success.
Handelsblatt: Five years ago, you were fighting each other to become the chief executive at RWE. One of you won, the other lost. How did you manage to work together later on the board for five years?
Peter Terium: I don’t work according to prejudices; I make my own judgments. And I quickly realized that I could work with Rolf. We are two very different types of people. Rolf is a trained power plant engineer; I am a financial expert. He had primarily worked in the German energy business, whereas I come from abroad. But we share one thing: We both worked for a long time in the operating business – and that is where you learn to approach work pragmatically.
But for you, Mr. Schmitz, it wasn’t so easy, having to make do with being the deputy.
Rolf Martin Schmitz: No. It would be different if you had a jerk for a boss. But back then, we sat down during the first afternoon and said we wanted to work together.
Mr. Terium, if everything goes as planned, you will no longer be the boss of the old, proud RWE but will be taking over a new, let’s say, green subsidiary. How long did it take you to decide which of the two jobs you would take over?
Terium: It was indeed a matter of conscience. From the beginning, I did tend more toward the new company. The idea of building something new simply appealed to me. But it’s not just a question of personal preferences; it’s about accepting responsibility for the company. And I believe that I am of more value to RWE here. The supervisory board was of the same opinion.
Strictly speaking, though, you are playing second fiddle, aren’t you?
Terium: No. Although my future company is officially a subsidiary of RWE AG, it is independent. You can be assured that the management question is very clearly regulated.
In other words, Mr. Schmitz cannot interfere?
Terium: That is absolutely clear. He can’t. But also, he doesn’t want to. The NewCo (eds: working title for the new company, whose name has not yet been decided upon) is supposed to attain the highest possible share price – and it is not going to if it is regarded purely as a placeholder for the majority shareholder’s money.
Schmitz: The IPO is supposed to generate new money for NewCo. However, the next step is that NewCo will also be a source of income for RWE – also to cover our balance sheet obligations, because we can gradually sell shares. And RWE will benefit more if the subsidiary company develops in a positive direction.