Deutsche Telekom names new CEO

Deutsche Telekom named Rene Obermann, the head of the company's T-Mobile wireless division, as its new chief executive, according to an Associated Press report.

Europe's biggest telecommunications company by sales announced the decision following a meeting of its supervisory board and after CEO Kai-Uwe Ricke tendered his resignation after four years in the top job, the Associated Press report said.

The Bonn-based company said in a statement that its supervisory board decided to appoint Obermann as CEO, effective immediately.

Shares of Deutsche Telekom were up 2.9% at 13.52 euros ($17.35) on the Frankfurt exchange after the announcement.

Klaus Zumwinkel, chairman of the supervisory board, which is the equivalent of a board of directors, said Obermann, 43, would serve well in keeping costs contained and moving the company forward.

T-Mobile has been one of Deutsche Telekom's bright spots, mainly through strong growth in the U.S. in recent years. While with T-Mobile, Obermann helped cut expenses there by 1 billion euros ($1.3 billion) and oversaw the elimination of 1,500 jobs.

But analysts wondered if Obermann, who was often viewed as a protégé of Ricke, would face similar scrutiny as the company seeks to stem its falling profits and lagging sales in face of increased competition in Germany and elsewhere in Europe, the report said.