Ericsson’s CEO Carl-Henric Svanberg is leaving his post to become chairman of British oil giant BP. The company’s current CFO and EVP Hans Vestberg will replace Svanberg when he steps down Jan. 1.

Dow Jones Newswires reports that 57-year-old Svanberg will retain his shares in the company and remain on the board of the company, which is the largest telecom equipment-maker in the world. Vestberg, 44, who has been at the company for 18 years, has been CFO since 2007. The company will search for a new CFO.

Analysts say Svanberg’s departure is not a surprise and that Vestberg has been groomed for the role for some time. Going forward, Ericsson (NSDQ: ERIC) is facing a ton of challenges, ranging from a slowing equipment market to increased competition from low-cost providers coming from China. It also needs to turnaround Sony Ericsson, the joint handset venture it shares with Sony (NYSE: SNE). Ericsson Chairman Michael Treschow said at a press conference that the company will continue heading in the same direction: “Organic growth will be the basis for our business going forward, with bolt-on acquisitions where needed. We’re also still aiming for a turnaround in our handset joint venture Sony Ericsson.”

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