May 2023: New CEO
The Board announces that1
– the current CEO is stepping down from the Board of Directors with immediate effect
– the current CFO (“Group Finance Director”) is appointed as the new CEO.
Our takeaway
We highlighted many times before that BAT is poorly managed and needs a ton of “clean-up” and “refresh”. The dismissal of the CEO is not surprising; it was a long-awaited decision. However, the way [it was executed] creates many questions marks: Board of Directors got together over the weekend and fired the CEO with immediate effect and without any explanation. The immediate dismissal makes us think that this has more to do with “clean-up” than “refresh”.
The market could only assume the worst under these conditions. As the market prices in an unknown/big governance risk (- in addition to the US market risks), BAT (BATS.L, BTI) is likely to test new 52-week lows.
References:
