Indra Nooyi steps down as PepsiCo CEO
PepsiCo said on Monday Indra Nooyi would step down as its longtime chief executive officer, handing over the reins to company veteran Ramon Laguarta, who has vast international experience spanning several continents.
Laguarta starts on October 3 and will be PepsiCo's sixth CEO in its 53-year history. He takes over as the beverage maker navigates a shrinking global soda market and evolving snacks sector, and spends more to stay one up against rival Coca-Cola Co and nascent players eating into market share.
"Ramon Laguarta is exactly the right person to help build on @PepsiCo's strong position and success. He has been a critical partner and friend and I am positive that he will take PepsiCo to new and greater heights in the years to come," Nooyi tweeted on Monday.
A 22-year veteran of PepsiCo, Laguarta oversaw global operations, corporate strategy, public policy and government affairs in his role as president.
He previously headed Europe Sub-Saharan Africa division - a unit PepsiCo characterised as "one of the most complex business divisions in the company," due to operations spanning three continents, with a mix of developed, developing and emerging markets.
Laguarta, 54, was named president of the company in September of last year and was tipped to succeed Nooyi. He also formerly led PepsiCo's Eastern European operations.
"With a deep understanding of PepsiCo's international operations, and a broader understanding of the total company portfolio in his role as president, we believe that Laguarta is well-placed to continue executing on PepsiCo's current strategy," analysts at Cowen & Co said.
PepsiCo's international operations rely less on beverages and more on snacks, an area Nooyi is largely credited with re-shaping and expanding as consumers shifted away from sodas and focused on healthy foods. The Frito Lay snacks business now contributes 46 per cent in total operating profits, nearly double its beverage business.
In her climb to CEO, she had a major hand in re-shaping PepsiCo - helping it to spin off its interest in Pizza Hut, KFC and Taco Bell while a top executive at the company. Since 2009, Nooyi has been on an acquisition binge - inking 80 tactical deals, including buying its bottling operations and the recent dehydrated fruit chips maker Bare Foods.
More recently, Nooyi focused on reinvigorating sales of its marquee sodas by stepping up marketing efforts to win market share from Coca-Cola.
As CEO for 12 years, she has boosted sales of the Mountain Dew and Gatorade maker to $63.5 billion, up 80 percent from when she started. The company's share price has risen 78 percent in the same period.
Nooyi will remain chairman of the board until early 2019.
PepsiCo said it has not yet entered into any compensation arrangements with Nooyi or Laguarta with respect to changes in their job roles.
PepsiCo's shares were up nearly a percent in premarket trading on Monday.