BAT names finance director Marroco as CEO as Bowles bows out

By Yadarisa Shabong and Richa Naidu

(Reuters) -British American Tobacco appointed finance director Tadeu Marroco as CEO on Monday, succeeding Jack Bowles who is stepping down after about four years.

Marroco started working for the tobacco firm in Brazil in 1992 and was appointed to the board in 2019.

Bowles, who also joined the board in 2019, has led the maker of Lucky Strike and Dunhill cigarettes through a transformation to focus on growth in new categories such as vape and e-cigarettes.

“Having been at the center of the formulation of this strategy, I am convinced that this is the right strategic path for BAT,” Marroco said in a statement.

The Brazilian, who has a degree in electrical engineering from the Universidade Federal do Rio de Janeiro, joined BAT’s management board in 2014 as its business development director.

Prior to leading the company’s transformation charge, Marroco – a keen follower of London’s Arsenal soccer team and Formula One motor racing – headed its key Europe and North Africa regions.

BAT shares have risen about 8% since the start of 2019, but underperformed a 15% rise in the FTSE 100 over the same period.

“We believe Tadeu Marroco is a worthy successor… and we would not expect a broader shift in strategy as a result,” JP Morgan analysts said.

Director Javed Iqbal will be interim finance director while the group looks for a permanent replacement for Marroco, the company said.

The news comes weeks after BAT agreed to pay more than $635 million to US authorities after a subsidiary pleaded guilty to charges that it conspired to violate US sanctions by selling tobacco products to North Korea and commit bank fraud.

RBC analysts said the change of CEO was “unexpected”, making them “wonder if BAT’s performance might be faltering in a way that is not immediately apparent”.

(Reporting by Yadarisa Shabong in Bengaluru and Richa Naidu in London; Editing by Savio D’Souza, Kirsten Donovan)