London: Reckitt Benckiser Group Plc. named PepsiCo Inc.’s Laxman Narasimhan as its next chief executive officer, looking outside its own ranks for a successor to Rakesh Kapoor after a difficult few years.
By turning to the food-industry veteran, the maker of Air Wick fresheners and Nurofen painkillers is looking for fresh leadership after the departing chief’s eight-year tenure was marred by a cyberattack, production glitches and a failed product launch. Narasimhan, 52, will take over on 1 September from Kapoor, who’s 60.
The shares traded 1% lower early Wednesday in London.
Reckitt will seek to tap the new chief’s digital acumen to improve its own capabilities as the consumer-goods industry wrestles with the shift to e-commerce and the sluggish performance of many mainstream brands. At PepsiCo he served as chief commercial officer, and was directly responsible for online sales platforms.
Before joining the soft-drink maker in 2012, the new Reckitt chief spent an earlier career at McKinsey & Co. Working in India, he spearheaded research on the emerging-market digital consumer as well as co-leading the firm’s global consumer insights practice.
Reckitt said it’s looking to Narasimhan to deliver improved performance in the health business, which Kapoor has seen as a key driver of growth. The move comes after Reckitt moved to distance its health unit from the division selling home-care products and other items, which has been seen as a possible prelude to a more formal separation.
The health division’s growth, which had previously outpaced the industry, has bogged down as Nurofen and other painkillers have come under siege from supermarket own-brand alternatives that can sell for a quarter of the price. Reckitt Benckiser also botched a product release in the Scholl foot-care business, and it’s been seeking to reinvigorate its infant-nutrition division after it was blindsided by a sales slowdown at Mead Johnson, which the company acquired in 2017.
“In the near term, focus will be on the turnaround of the currently underperforming health division," as well as the restructuring, Deutsche Bank analyst Eva Quiroga-Thiele said in a note.
Under Kapoor, the company was initially an investor favourite. The shares have lost about one-fifth of their value since a 2017 peak, though they’ve gained 5.1% so far this year. Narasimhan is the latest high-ranking executive to depart PepsiCo in recent months, following Al Carey, who retired in March after serving as the company’s CEO of North America, and Vivek Sankaran, who was tapped to run the company’s food business in North America.