Green Mountain Coffee names Coke exec as new CEO
WATERBURY, Vt. (AP) — Green Mountain Coffee Roasters Inc. has picked a new CEO, Coca-Cola executive Brian Kelley, as the coffee company deals with slowing sales growth.
Kelley, 51, will also become president and join the board, effective Dec. 3.
Shares added $1.66, or 6 percent, to $28.99 in afternoon trading. The stock had dropped 39 percent this year.
Green Mountain Coffee had said earlier this year that its current CEO, Lawrence Blanford, would retire by the end of 2013, or earlier if the company found a replacement for him. Blanford took over as the Waterbury, Vt., company's chief executive from its founder, Robert Stiller, in 2007.
A pioneer of single-serve coffee in the U.S. with its Keurig machines, Green Mountain Coffee grew quickly on their popularity. But the company has struggled as patents on technology for its K-Cups expired and competitors released their own single-serve coffee makers — including coffee chain giant Starbucks Corp. Green Mountain Coffee has said that its sales growth will moderate from the fast run-up over the past few years, and its shares had dropped 39 percent this year.
The company also continues to deal with a two-year-old SEC inquiry into its accounting practices.
Kelley had been on track to become president of Coca-Cola Refreshments, Coca-Cola Co.'s North America business unit, starting on Jan. 1. He joined Coca-Cola in 2007 and has served as Coca Cola Refreshments' chief product supply officer since 2010.
"While the abrupt resignation of Mr. Blanford is notable, we view the announcement favorably as Mr. Kelley's operations experience at Coke is an area of considerable weakness at Green Mountain," said Stifel Nicolaus analyst Mark Astrachan. He said Kelley could help Green Mountain Coffee improve its supply chain and manufacturing process.