Blog: New Coke CEO? Anyone? Anyone?
Chris Brook-Carter | 20 April 2004
When Douglas Daft, the CEO of the Coca-Cola Company, announced that he was to retire later this year, many investors were initially hostile to the board’s decision to delay naming an heir, fearing that it left the soft drink giant rudderless and cast doubt on the credentials of the obvious internal candidate, Steven Heyer. Wall Street, however, seems to be warming to the idea of the external headhunt that has followed – particularly now that the hunt includes Gillette’s chairman and CEO Jim Kilts.
Shares in the company yesterday rose to a 52-week high following reports that Kilts was leading a field that also includes Mattel Inc. chief executive Robert Eckert, Kellogg Co. chief executive Carlos Gutierrez, and R. Kerry Clark, vice chairman of The Procter & Gamble Co. Coke’s shares closed on Monday at US$53, up by $1.07, or 2.1%. The day's strongest level of US$53.50 was a 52-week high.
Kellogg boss Gutierrez has apparently already ruled himself out, leaving Kilts as the favourite. If Heyer, currently Coke’s COO, is to convince the board and the financial institutions he is the better man, it will take quite a fight.
Kilts has a reputation as a solid businessman. Whilst at Gillette, and previously Nabisco, he has cultivated an image as a tough operator and a great manager of big brands – just the combination Coke’s critics believe the company needs, after what they see as years of directionless leadership.
"Jim Kilts tries to maximize the potential of 'big' brands," said Morgan Stanley drinks analyst Bill Pecoriello in a report issued on Monday. "He likes to be in control, is extremely detail-oriented, requires accountability for every manager, is tough and has a relentless focus on the business."
The full 16-member Coke board of directors will get an update on the search at a regularly scheduled meeting today, in advance of tomorrow's annual shareholders meeting.
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