Wrigley Hires Perez to Serve As Its CEO
Monday, October 23, 2006; 4:53 PM
CHICAGO -- Wm. Wrigley Jr. Co. turned over the leadership of its chewing-gum empire to an outsider for the first time after four generations in the Wrigley family, naming ex-Nike Inc. CEO William Perez on Monday to replace Bill Wrigley Jr. as chief executive after a turbulent past year.
Wrigley will remain chairman of the 114-year-old company, a job he has held along with the chief executive's role since his father William Wrigley died in 1999.
The surprise announcement came as Wrigley reported a 14 percent increase in third-quarter earnings to $148 million, lifted by a sales rise in Asia, to exceed Wall Street's expectations.
The news resulted in the biggest single-day increase in Wrigley's stock in at least 20 years. Shares jumped $6.40, or 13.7 percent, to close at $53.23 on the New York Stock Exchange.
The gum, candy and mint manufacturer's once high-flying stock had declined sharply since last year when it spent more than $1.4 billion to buy Life Savers, Altoids and other businesses from Kraft Foods Inc. _ an expensive, debt-funded acquisition that it has struggled to absorb.
Bill Wrigley shook up the top management team in April as Chief Financial Officer Ronald Waters departed, but generating profits from the new businesses has continued to prove difficult.
He said it was solely his idea, endorsed by the board of directors, to bring in another executive to run the day-to-day operations while he focuses on strategy and innovation.
"I will have a greater opportunity to focus on key growth strategies for the company that will drive our global leadership position," Wrigley said at a rare news conference.
"Frankly there's so many opportunities to take advantage of out there that it makes sense to divide and conquer and allow me to work on some of the longer-term growth strategies and some other things, and Bill works on running the company day in and day out."
The 59-year-old Perez lasted barely a year as an outsider CEO at Nike, resigning in January over differences with Phil Knight, the company's co-founder.
Perez previously spent 34 years, eight of them as CEO, at Wisconsin-based SC Johnson, which like Wrigley is a family-owned business that derives more than half its sales internationally. He also will join Wrigley's board of directors.
The executive said he has no concern about a recurrence of the conflict that led to his departure from Nike.