Martin Orlowsky Retiring; Former UST CEO Murray Kessler Takes Over
Lorillard announced today that 11-year CEO Martin Orlowsky will be retiring, effective September 13, 2010. Mr. Orlowsky will be succeeded by former UST CEO Murray Kessler – who spent six months at Altria in 2009 assisting the company with the UST integration. Mr. Orlowsky will stay on for two years as a consultant to Lorillard’s Board of Directors.
Mr. Kessler Brings Record of Cost-Cutting and Smokeless Expertise
We spent a lot of time with Mr. Kessler during his tenure at UST. We believe that Mr. Kessler brings a strong track record of cost discipline. One of his last initiatives within UST, before purchase by Altria, was Project Momentum – which significantly boosted margins (which were already high). Additionally, Mr. Kessler clearly brings expertise on how to run a smokeless tobacco business –where Lorillard lacks exposure (and is likely to focus on expanding into this area).
The above info was provided by UBS analyst Nik Modi.
What are your thoughts?
Is this a good move?
Is it good for Lorillard?
Do you agree with Nik Modi’s thoughts?
10 comments ↓
Some more info.
Kessler, 51, joins Lorillard most recently from Altria Group Inc., where he served as vice chair of Altria and president and CEO of UST LLC, a wholly owned subsidiary. Kessler held this position from January 2009 through June 2009, the six months following the acquisition of UST Inc. (“UST”) by Altria.
Speaking on behalf of Lorillard’s Board of Directors, lead independent director Richard Roedel said, “On behalf of the board, I want to take this opportunity to thank Marty for his leadership, vision and commitment to Lorillard. For the past year, the Board of Directors has searched for a chief executive officer with the industry and leadership experience to succeed Marty. Murray’s outstanding background and significant experience in the tobacco industry make us confident that he is the right choice to successfully lead Lorillard going forward.”
Commenting on his new appointment, Kessler said, “Thanks to Marty and his strong leadership team, Lorillard has outperformed the tobacco industry in almost every key measure. I am honored to join the leadership team of this great company, its dedicated employees and passionate Board of Directors. I am confident that together we will build upon the company’s strategy of responsibly winning in the marketplace and, as a result, grow shareholder value. I look forward to working with Marty to ensure a smooth transition.”
Prior to 2009, Kessler had served as chairman of the board of UST, the principal businesses of which included U.S. Smokeless Tobacco Co. and Ste. Michelle Wine Estates, since January 2008, and as president and CEO of UST since January 2007. He was president and COO from November 2005 to December 2006 and was president of USSTC from April 2000 through October 2005.
During his tenure at UST, the company experienced tremendous growth including an increase in enterprise value from $3 billion to $12 billion. Prior to joining UST, Kessler had over 18 years of consumer-packaged-goods experience with companies including Campbell Soup and Clorox.
Kessler earned a Bachelor of Science in business administration from Villanova University and an M.B.A. in marketing and finance from New York University’s Stern School.
Greensboro, N.C.-based Lorillard Inc. is the third-largest manufacturer of cigarettes in the United States. Founded in 1760, Lorillard is the oldest continuously operating tobacco company in the U.S. Newport, Lorillard’s flagship menthol-flavored premium cigarette brand, is the top-selling menthol and second-largest-selling cigarette in the U.S. In addition to Newport, the Lorillard product line has five additional brand families marketed under the Kent, True, Maverick, Old Gold and Max brand names.
Well, let’s just wait and see what Kessler does to Lorillard….it doesn’t look too good to me.
As long as he was not influenced by Altria too much, maybe this will work. Take all of the mistakes he saw the untouchables make and build on them. Altria is in trouble anyhow, reorganizing all of thier failures while throwing money around to make the street happy. The brass is tarnished and robbing all of the people that make the company run. Go Murray, we all know you can do it. Stay focused on the people, you will be successful.
Listen people, Kessler was hired for one simple reason: he knows how to sell a company. He did it for USST, and now he will see the sale of Lorillar through.
Oh My I heard the news and all I can think of is couldn’t they sell the company without bringing in a hired gun! What is the outcome? Not good. Take a package and run you guys in green!
I think Murray’s credential include overseeing the demise of USST market share and the eventual number one selling moist snuff SKU being a Conwood brand
Murray is an idiot. The above person who said he was brought in to sell the company is spot on…. Seems to me the company sells itself once the menthol issue is fixed, or dies if it is not. Murray cannot affect this any more than a swimmer can pull an oil tanker.
Oh my Bertram you don’t mix words!
Being in the Cigarette business for years, the smokless is a completly different market, the volume in smokeless is very small compared the smokes.Murray the K has a huge learning curve. Lorillard is completly entrenched with old blood. It was smart to bring in new blood, whether they sell the company or not
and the hard working loyal people that make lorillard will be xxxx again
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