Starbucks appoints Chipotle CEO Brian Niccol as new head, Laxman Narasimhan steps down
Seattle (US): Multinational chain of coffeehouses Starbucks on Tuesday announced Chipotle Mexican Grill's head Brian Niccol will be its new chairman and chief executive officer, replacing Laxman Narasimhan.
Laxman Narasimhan had assumed the post just a year ago March 20, 2023.
Niccol will begin in his new role on September 9 and the company’s CFO Rachel Ruggeri will be the interim CEO until then.
“Our board believes he will be a transformative leader for our company, our people, and everyone we serve around the world,” the coffee chain said in a blog post.
“I am excited to join Starbucks and grateful for the opportunity to help steward this incredible company, alongside hundreds of thousands of devoted partners,” the newly-appointed CEO said.
Narasimhan, who was appointed as Starbucks CEO in September 2022, is stepping down from his role as CEO and board member with immediate effect, according to media reports.
Following the news, Starbucks shares surged 12 percent in premarket trading, while Chipotle shares dropped 10 percent.
In May 2024, Starbucks had to cut its guidance for the third consecutive quarter and reported its first sales decline since late 2020.
Narasimhan had taken over from longtime Starbucks leader Howard Schultz, who served as interim CEO after coming out of retirement while the company searched for a new chief executive.
Starbucks had announced Narasimhan's appointment as CEO in September 2022.
Before joining Starbucks, Narasimhan was the CEO of UK-based consumer health and nutrition company Reckitt and had previously held a long tenure as an executive at PepsiCo.
The sudden leadership change follows reports that activist investors Elliott Investment Management and Starboard Value had acquired stakes in Starbucks.
Starbucks and Elliott were reportedly in discussions to add Jesse Cohn, a managing partner at the activist investor, to its board of directors.
The coffee chain was also considering setting up committees to review capital allocation and operational improvements.
Meanwhile, Chipotle has appointed Chief Operating Officer Scott Boatwright as interim CEO.
Mellody Hobson, Starbucks board chair, will become the lead independent director, and Narasimhan will also resign from his board seat.
Chipotle’s CEO since 2018, Brian Niccol, who became chair of its board in 2020, earlier served as CEO of Taco Bell.
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