Kion Group Names Rob Smith as New CEO

We were somewhat surprised by the choice of Rob Smith from KoneCranes as Kion Group's new CEO starting in January 2022. While Smith has capital goods and European experience, he lacks a long-term track record as a CEO. He also seems to have little experience with logistics and warehouse end markets, automation technologies, and China as a market, which are all three long-term value drivers for Kion. Smith is currently CEO of KoneCranes but held that position for just eight months before the announced merger of KoneCranes and Cargotec, which will see the current Cargotec CEO will take over as CEO of the combined company. Before joining KoneCranes, Smith spent six years at farming equipment supplier Agco as a senior vice president and general manager for Europe, Middle East, and Africa. Kion services a different end market, warehouse/logistics, and its long-term upside lies in its warehouse automation equipment (SCS division). However, the current head of SCS, Hasan Dandashly, has been in that position for three years with the business executing well. We maintain our narrow moat. Shares look fairly valued relative to our EUR 90 fair value estimate.