The food and beverage company most known for its Oreo brand, Mondelez International Inc. (NASDAQ:$MDLZ) has just announced that the CEO of Canadian frozen foods company McCain Foods (traded privately), Dirk Van de Put, will be taking over Irene Rosenfeld’s role as CEO of Mondelez effective November 2017. Van de Put will also become chairman after Rosenfeld fully retires in March 2018. Following the news, Mondelez’s stock decreased a bit before picking back up during trading day Wednesday, August 2. As of 3:12 PM EDT, Mondelez’s stock has increased 0.50%.
Rosenfeld’s retirement from Mondelez marks the end of an 11-year career as CEO – first as the CEO of Kraft, then as CEO of Mondelez, after spinning off from Kraft in 2012. During this time, the company dealt and worked with big-name activist investors Bill Ackman and Nelson Peltz. It also had to face the failure to purchase Hershey Co (NYSE:$HSY). It is clear that whoever takes over for Rosenfeld will have to be able to steer the company throughout possible similar problems in the future, which was why the company chose Van de Put.
Van de Put, who’s worked for big-name companies like Coca Cola Co. (NYSE:$KO) and Mars, Inc. (traded privately), has worked in the packaged foods and beverages industry for quite a while now. His recent success at McCain Foods by increasing sales by more than 50% showcases the strong capabilities he has to lead a company. “Dirk is a seasoned CEO who has grown both top and bottom line in challenging circumstances,” Rosenfeld assured during an interview with CNBC.
Indeed, it seems as if Van de Put will see some challenges ahead as demand weakens in confectionary products like biscuits and chewing gum. Not only that, Mondelez recently experienced a cyberattack that greatly impacted the company’s shipping and invoice systems, just four days before the end of its second-quarter, according to Rosenfeld. As a result, overall sales were also negatively affected.
“It is taking us a bit of time to recover… I would not be looking for dramatic upside over the guidance we have given,” Rosenfeld warned. Mondelez has since reaffirmed its guidance of a 1% increase in organic sales growth in 2017 overall.
Erik Gordon, a professor at the University of Michigan, believes that, given the slowing of organic sales growth, a new CEO will help the company. Financial firm JP Morgan (NYSE:$JPM), however, thinks that Mondelez’s decision not to hire a new CEO from within the company to focus on its growth may not be what investors wanted, as it shows that Mondelez will not be putting itself up for sale any time in the near future.
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