Siemens ousted its chief executive yesterday after a high-stakes boardroom battle at the German industrial giant.

The 166-year-old company did not look far for a successor to departing chief executive Peter Löscher: Joe Kaeser, the Bavarian-born chief financial officer and company veteran since 1980.

After a week of turbulent meetings, much media speculation and even an intervention by the chancellor Angela Merkel, Mr Kaeser promised yesterday to return to an even keel the sprawling company that makes everything from MRI scanners and gas turbines to high-speed trains and hearing aids.

However, he admitted the company, employer of 370,000 in more than 190 countries, needed a new medium-term strategy to regain ground lost to competitors such as General Electric and Philips.

Yesterday's appointment marks the end of the road for Austrian chief executive Mr Löscher (55). He was hired from US drug company Merck in 2007 to restore a reputation tattered by revelations of a culture of corruption and bribery to secure lucrative contracts.

Mr Löscher helped put the company back on track, and last year it posted a €4.6 billion profit on a turnover of €78.3 billion. However, once the Siemens tanker had steadied, problems began to emerge: struggles with wind-energy projects; delayed delivery of high-speed trains in Germany; and sinking performance in China.

Last week the group issued a profit warning, dropping hopes of boosting core operating profit margin by 2014.

It was the final straw for leading investors and the supervisory board. At an emergency weekend meeting at Munich airport, board members sounded out whether Mr Löscher would depart of his own free will.

He indicated he would not go, at least not unless supervisory board chief Gerhard Cromme went too.

Yesterday the company said Mr Löscher’s departure was by “mutual consent”, although Mr Cromme remains.