New Delhi | Mumbai: Manu Anand, former region president, India and South Asia, at beverage and snacks firm PepsiCo, may be joining chocolate and confectionery giantMondelez in an Asia-Pacific role, two officials with direct knowledge of the development said.
Messages to Anand, who quit PepsiCo last week in what was seen as a sudden and abrupt move, remained unanswered. ACadbury India spokesperson said, in response to an email query by ET, that it would not comment on speculations. When his exit was announced last Thursday, Anand had told ET that he wanted 'time out', after working 19 years with the company. "I have decided to opt for early retirement from PepsiCo," he had said.
"PepsiCo saw Anand's move to Mondelez as that of joining a rival firm, because both firms sell overlapping products like packaged snacks in many world markets. It did not go down well with the management, hence, his abrupt exit," one of the officials added.
According to the two officials in the know, a combination of factors at PepsiCo India, including lack of clarity over whether to focus on gaining market share or pushing profitability, and an unwieldy top-deck management structure, has led to instability and created dissonance in the company. PepsiCo's falling market share in beverages - in April 2013, retail audit numbers sourced from Nielsen show PepsiCo India's share was 29.7%, compared to 32.1% in April 2012 - and lukewarm response to its expensive IPL sponsorship and ad campaign, are additional factors that may have played a role.
"While one faction of PepsiCo's headquarters believes it should focus on profitability even if at the cost of share, there's an opposite view that market share should be protected," another official added. This is the first time that PepsiCo India's head has quit at short notice, without a succession plan in place. A PepsiCo India statement had said Anand was exiting to 'join another company'.
A note sent to employees by Saad Abdul-Latif, CEO of PepsiCo Asia, Middle East & Africa, said that till the time a new president is announced, Gautham Mukkavilli, senior VP and GM (beverages) and Praveen Someshwar, senior VP and GM (foods) would report directly to him.
Anand had joined PepsiCo in 1994 as CFO of the foods division, Frito-Lay, and in 1998 was elevated as MD of the foods arm. He later relocated as GM of PepsiCo South East Asia in 2007-10. He succeeded outgoing chairman Sanjeev Chadha in January 2011.
While Cadbury India dominates the chocolate category in India with over 67% share, 2012 saw the company experience its slowest growth in profits and sales in over six years. Its managing director and other senior executives had taken a pay cut in that year as well. The firm's revenues increased 20.8% to 4,065 crore in 2012, the lowest growth rate since 2006 and a sharp deceleration from the 34.4% growth recorded in 2011. Profit after tax increased by just 2.1% to 303.4 crore. Anand Kripalu, who joined the maker of Dairy Milk and Bournvita seven years ago, was heading India and South East Asia until last year before being redesignated India MD in 2013.
Meanwhile, sales of rival Ferrero India, which makes Kinder Joy and Roche chocolates, grew by 30%, though on a smaller base, and its premium brands are emerging as strong rivals in the gifting segment.
Earlier this year, Cadbury's global snacks and chocolate parent restructured its emerging markets operations to create individual business units for India and China and dissolve the developing markets division.
Mondelez Global CEO Irene Rosenfeld had said that emerging markets, which account for 44% of the firm's global revenues, will receive the lion's share of its resources. Recently, Rosenfeld announced a plan to invest $600 million over three years in emerging markets, including China and India.