Coca-Cola Makes Management Changes; Asia, Africa Chiefs Eased Out
May 24 2016 - 12:47PM
Dow Jones News
By Mike Esterl
Coca-Cola Co. shook up its management Tuesday, replacing the
heads of its Asia and Africa businesses, in the first major move by
President and Chief Operating Officer James Quincey to put his
stamp on the beverage giant.
Mr. Quincey, who now looks more likely than ever to succeed Coke
Chief Executive Muhtar Kent, also is realigning the international
structure. The company is creating a consolidated Europe, Middle
East and Africa group in the latest attempt to boost profits and
revenue amid sluggish soda sales.
As part of the change, Brian Smith, the company's 60-year-old
Latin America president, will be transferred to head the expanded
operating group in August. Nathan Kalumbu, 52 and current president
of Eurasia and Africa, will focus on projects in Africa before
retiring from the company at the end of December.
John Murphy, the 54-year-old head of the South Latin division,
will become president of Asia Pacific, replacing Atul Singh. Mr.
Singh, 56, will transition to chairman of Asia Pacific before
retiring from the company in March.
Mr. Quincey was named to his current position last August,
making him Mr. Kent's top deputy. That move had already created
speculation that Mr. Quincey, 51, was in line to succeed Mr. Kent,
though neither Coke nor Mr. Kent would say.
The latest personnel moves are likely to further fan speculation
that had been building internally that Mr. Kent, who is 63, will
officially designate Mr. Quincey his successor later this year or
in early 2017.
Coke again declined Tuesday to comment on any potential
succession plans and Mr. Kent, who is also chairman, hasn't said he
plans to step down any time soon. The company said Mr. Quincey
recommended the structural and leadership changes with Mr. Kent's
full support.
Tuesday's changes "will continue to lay the foundation for
strong leadership and management continuity," said Mr. Kent in a
statement.
In a Q&A posted on the company's website, Mr. Quincey said
the new structure should be more efficient and that the leadership
changes will bring "freshness" to markets.
"A fresh pair of eyes is a good thing; stability is also a good
thing. It's important to strike a balance between the two," he
added.
Coke reported last month its growth slowed in the first quarter,
dragged down by its namesake cola, renewing questions of whether it
can return to promised revenue increases in the mid-single digits.
Soda volumes were flat after five straight quarters of increases,
hurt by a weakening global economy and rising health concerns over
sugary drinks.
Mr. Kent, who became CEO in 2008, has been delegating more
decision-making to Mr. Quincey, who took a prominent role at an
annual meeting with Coke bottlers in Greece earlier this month.
Mr. Quincey is elevating lieutenants from Latin America. That is
where he made his initial mark at the company, becoming Argentina
head in 2000 and Mexico chief in 2005 before overseeing Europe.
Mr. Smith, a 19-year company veteran, ran Brazil from 2002 to
2008 and headed Mexico until 2012 before being promoted to Latin
America president in 2013.
Mr. Murphy currently heads operations in Argentina and five
smaller South American countries and oversaw the company's
businesses in Central America and the Caribbean from 2008 to 2012.
But the 28-year company veteran also has experience in Asia, having
held earlier posts in Japan and Indonesia.
Coke is promoting Alfredo Rivera to Latin America president,
succeeding Mr. Smith. Mr. Rivera has held several posts in the
region since joining Coke in 1997, most recently overseeing
operations in Central America, the Caribbean and Venezuela, Ecuador
and Colombia.
The moves also come as Coke divests manufacturing and
distribution assets in North America to focus on its more
profitable concentrate business while deepening a consolidation
drive among overseas bottling partners.
Coca-Cola Enterprises Inc. shareholders voted Tuesday to approve
a European bottling merger, which would create the largest
independent Coke bottler by sales world-wide. The merger is
expected to close by this weekend and combines Coca-Cola
Enterprises, which distributes Coke in the U.K. and France, with
Spain's Coca-Cola Iberian Partners and Coke's German bottling unit.
The deal was announced last summer.
The newly created Europe, Middle East and Africa operating group
combines two groups, Europe and Eurasia & Africa. Coke also is
combining several business units in central and Eastern Europe, in
addition to tweaking its operating structure in Africa. Coke says
the changes better align its business more closely with bottlers'
geographic footprints.
Anne Steele contributed to this article
Write to Mike Esterl at mike.esterl@wsj.com
(END) Dow Jones Newswires
May 24, 2016 12:32 ET (16:32 GMT)
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