Will AB-InBev seek replacement for its Brazilian CFO?
Belgium | It would be a symbolic sacrifice if AB-InBev were to part with its current Chief Financial Officer, Felipe Dutra, in order to improve its standing with analysts and investors. Mr Dutra has been CFO of the world’s major brewer for 15 years.
As was reported by the website retaildetail.eu on 8 January 2020, quoting an article in the Financial Times, the future of Mr Dutra was discussed at the company’s latest Board of Directors meeting.
For fifteen years, the 50-year-old Brazilian has been CFO in what has become the largest brewery group in the world, under CEO Carlos Brito’s guidance. But the group’s floundering share price, the messy IPO in Hong Kong, and the all-but-secure sale of AB-InBev’s Australian unit, Carlton & United Breweries (CUB), might now cost him his job.
Growing through acquisitions
The Belgian-Brazilian group was founded in 2004 as InBev, and has spectacularly expanded its global reach through acquisitions (most notably that of Anheuser-Busch in 2008), but the acquisition of SABMiller in 2015 has proved to be harder to digest. Its foray into the craft brewing industry may make business sense. However, to many investors it does not seem like a grand plan.
Add to this AB-InBev’s mountainous debt pile, the painful slashing of dividends in 2018 and the drop of its share price from EUR 117 after the SABMiller acquisition (November 2015) to EUR 71 in mid-January 2020, and you can see why investors are grumbling.
The interesting question to ask is: who leaked the story to the Financial Times and what are their motives? Because one thing is certain. Even if a majority of board members are still in support of Mr Dutra, after this carefully planned leak to the Financial Times, they will find it hard to come up with a convincing argument as to why he remains their first choice to take the company forward.
Who is the real target?
It is a moot point, but was Mr Dutra singled out because the critics lacked the courage to ask for Mr Brito to step down?
The Brazilian Nelson Jamel, 46, who has been with the brewer since 1997 and currently serves as Vice President Finance of AB-InBev’s North American division, is said to have been mentioned as a possible new CFO at the board meeting.
AB-InBev has declined to comment.
The brewer could announce a decision as early as next month, says the Financial Times, with both external and internal candidates being considered.
Rest assured the issue will be solved by 27 February 2020 when AB-InBev reports Full Year 2019 results.
