Diageo appoints new CEO - UPDATE

7th May 2013 07:10

Diageo announced Tuesday the appointment of Ivan Menezes as Chief Executive Officer. Menezes will begin on July 1st and succeeds Paul Walsh who will step down from the board at the annual general meeting in September and retire from the company in June 2014. Walsh will focus on transitioning critical partner and external relationships to Menezes in his final year. "Paul is an outstanding Chief Executive. He has served our business, its shareholders, employees and partners with enormous imagination and dedication over the past 13 years," said Chairman Franz Humer."I know he is justly proud of Diageo and its people and he leaves a great legacy for his successor. The board is immensely grateful for his ambitious and thoughtful stewardship of the business and its people. The transition process which has been put in place enables Paul to contribute his knowledge and experience during Ivan's first year as Chief Executive Officer."Menezes has been the brewing company's Chief Operating Officer since last March and has previously worked for Guinness, Nestle, Booz-Allen & Hamilton and Whirlpool.Investec analyst Martin Deboo said it was a well-flagged change that was unlikely to have much impact on the share price Tuesday."For us, Menezes' immediate priority will be to deliver on Diageo's organic growth agenda, which has looked a bit less sprightly recently," he said."Beyond that, we think he needs to think about how best to evolve the strategy and portfolio, around which we continue to question the valuation creation from the integration of spirits and brewing." The broker retained its 'hold' rating and 1,970p target price. Diageo's shares remained unchanged at 1,974p at 11:46 Tuesday.RD