(Bloomberg) — Schneider Electric has unexpectedly dismissed its Chief Executive Officer Peter Herweck after just a year and a half at the helm, citing disagreements with the board over the company’s strategic direction. This French manufacturer specializes in energy-management equipment and software.

The company announced on Monday that its board has appointed Olivier Blum, a long-time executive, as the new CEO, effective immediately. The board is chaired by Jean-Pascal Tricoire, who has been instrumental in transforming Schneider into one of France’s largest companies, boasting a market value of €137 billion ($149 billion) through multiple acquisitions during his 17-year tenure as CEO.

The leadership shake-up occurs at a time when Schneider has faced challenges with supply constraints resulting from an extended period of heightened demand, which has impacted sales growth in North America, especially in the U.S. residential buildings sector. Additionally, the company was recently penalized by French regulators due to a price-fixing investigation.

Despite these challenges, Schneider reiterated its financial targets for the year last week. The company’s shares recently reached an all-time high, driven by increased demand for transformers, inverters, sensors, meters, software, and systems, fueled by a surge in data center requirements and government initiatives promoting the transition from fossil fuels to electric power.

The company’s shares, which dropped as much as 2% at the open in Paris Monday, are still up 31% this year.

The new CEO, Blum, 54, has been a member of the company’s Executive Committee since 2014. Before his present role as technology and operations leader of the largest business of Schneider Electric, he held a wide array of positions at the group.

Blum, who has been with Schneider for more than 30 years, has served in key roles at the company, including as country head for India and strategy and business leader in China.

Herweck, who joined Schneider in 2016, had taken over the top job from current Chairman Jean-Pascal Tricoire, who had been CEO between 2006 and 2023.

The change in leadership comes shortly after the company was fined by French antitrust regulators over a price-fixing agreement.

On October 30, Schneider, Legrand SA, along with distributors Rexel SA and Sonepar, were collectively fined €470 million ($512 million) by French regulators. The French competition authority reported that these manufacturers colluded from 2012 to 2018 with distributors to manipulate prices for low-voltage electrical equipment through a specific price agreement mechanism.

Schneider faced the largest penalty, amounting to €207 million. All the companies involved expressed their disagreement with the competition authority’s reasoning and indicated that they may pursue an appeal.

Schneider did not mention the price-fixing case in its announcement regarding the new CEO on Monday.

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