Percy Barnevik, chairman of the Swiss-Swedish electrical engineering giant ABB, has stepped down after 22 years.

The Swedish newspaper Dagens Industry said the resignation followed talks between the Wallenberg-family led investment firm Investor, which holds a controlling stake in ABB, and BZ Group, a Swiss investment firm controlled by the financier Martin Ebner and a major owner of Investor shares.

Although Mr Barnevik's resignation was unexpected, he has recently come under increasing criticism from shareholders following a slump in the price of ABB shares.

The outgoing chairman acknowledged he was partly to blame for the decline.

"I also with my departure take my share of the responsibility for the less good performance of ABB in recent years," he said.

Share price slump

ABB shares fell from a high of 54.50 Swiss francs in February 2000 to just 9 francs early last month.

The company's shares fell again, by 0.3% to 17.40 francs, after Mr Barnevik's departure was announced.

He will be succeeded as chairman by ABB board member Juergen Dormann.

Joergen Centermann is to remain as chief executive.

Mr Barnevik has led the company for a total of 22 years, including the eight years he spent as head of Swedish firm ASEA before it merged with Switzerland's Brown Boveri to form ABB.

Management legend

The successful completion of that merger, one of the largest ever between companies based in different countries, sealed Mr Barnevik's reputation as a legend among corporate executives on a par with General Electric's Jack Welch.

To this day, master of business administration classes study the creation of ABB as a textbook example of how to manage a cross-border merger of companies with different cultures and values.

However, ABB, once the darling of European stock markets, has fallen on hard times since the onset of the global economic slowdown.

Former chief executive Goran Lindahl, who had pledged to turn the company round, left in January this year to join the board of mining company Anglo American.

Burdened with a $6bn debt mountain, ABB last month said it expects a 10% decline in profits this year, and announced plans to lay off 12,000 jobs.