Coke CEO to Retire at Year’s End

Coca-Cola Co. Chief Executive Doug Daft, who has been dogged by government probes of the company, disappointing sales and an anemic stock price, will retire at the end of 2004, the world’s largest soft drink maker said Thursday.

Atlanta-based Coca-Cola said President and Chief Operating Officer Steve Heyer, who in December took control of North American operations, would be a strong internal candidate to take over as chairman and chief executive.

Sluggish sales of Coke’s soft drinks and other products, particularly in North America, the company’s top market, taxed Daft’s tenure as CEO and kept a lid on the stock price he had been expected to revive.

Investors and analysts gave the news a mixed reception.

“I think that fresh blood will really be good for the company,” said Ted Parrish, co-manager of Henssler Equity Fund of Marietta, Ga. “It’s been the same old boring Coke for quite a while.”

“This is a real surprise,” said Knox Fuqua, fund manager at AAM Equity Fund, who added that Coca-Cola probably was his biggest holding. “I don’t want to see Coke go through another management change.”

Company officials expressed confidence in Heyer, who “has made a lot of important contributions to this company,” board member Jimmy Williams said.

Williams said the impending departure of Daft, an Australian with more than 30 years of service at the company, was unrelated to federal probes of whether the soft drink maker improperly inflated earnings and engaged in other corporate wrongdoing.

The Securities and Exchange Commission and Justice Department began investigating the company last year after a former Coke employee filed lawsuits that accused the company of fraud.

Daft said in a statement released by the company that the unexpected retirement was consistent with his own wishes.

Daft took the reins at Coca-Cola on Feb. 17, 2000. The stock closed that day at $52.31, slightly higher than Thursday’s close of $51, down 24 cents on the New York Stock Exchange.

Under Daft, Coca-Cola cut thousands of jobs in a series of restructurings. Several managers, including former President and Chief Operating Officer Jack Stahl, left the company during the Daft era, prompting questions about Daft’s ability to get along with others.

But Daft did get credit from some analysts for settling an embarrassing racial discrimination lawsuit filed by black employees, improving the soft drink maker’s relationship with bottlers and overseas regulators and embracing product innovation as a cornerstone of Coca-Cola’s growth strategy.