Perrigo Company plc (PRGO - Free Report) announced the appointment of Murray S. Kessler, a consumer goods veteran, as its new president and chief executive officer (CEO), effective immediately. He will also get a seat on Perrigo’s board.
Kessler most recently served as the CEO and president at Lorillard Tobacco Company. Lorillard, which was purchased by Reynolds American Inc. in 2015, saw its market cap go up from $9 billion to $28 billion during Kessler’s tenure.
Kessler will replace Uwe Roehrhoff who is stepping down from his role as president, CEO and board member but he will remain available to ascertain a smooth transition. Perrigo had hired Uwe Roehrhoff just 10 months back. Though the appointment of a new CEO in less than a year comes as surprise to the investor community, some may applaud the change. This is in view of the fact that Perrigo’s stock has declined almost 21% since Roehrhoff’s appointment. Perrigo’s stock is down 16.4% this year so far against 17.1% increase of its industry.
Kessler brings with him leadership experience of more than 30 years in consumer products companies. Prior to serving as CEO of Lorillard from 2010 to 2015, Kessler was the vice chairman of Altria, Inc. and president and CEO of UST Inc., a wholly owned subsidiary of Altria from 2007 to 2009. He has also worked with consumer product companies like Campbell Soup Company (CPB - Free Report) and The Clorox Company (CLX - Free Report) .
The appointment of Kessler is in sync with Perrigo’s shift to a consumer-based strategy against the backdrop of the pending separation of its prescription pharmaceuticals business (“Rx unit”)
In August, Perrigo announced its plan to divest its Rx unit to unlock shareholder value. The segment is facing declining sales amid competition. The separation is likely to help Perrigo better capitalize on its differentiated generic pharmaceutical products and focus on expanding its leading consumer business.
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