Norman Adami and André Parker to retire

The world’s number two brewer is to lose two of its longest-serving stalwarts: André Parker, Managing Director of SABMiller Africa and Asia, and Norman Adami, President and CEO SABMiller Americas, will both be retiring from the company in the coming months.

In corporate speak, the phrase “to spend more time with his family” is just a benign lie. It usually marks the end of a corporate relationship that has turned sour. With this phrase, the departing executive is complimented out through the revolving doors, hopefully never to be seen again - anywhere.

Sometimes, however, this phrase speaks the truth. When SABMiller announced in August that Norman Adami, President and CEO of SABMiller Americas, will be retiring from the company to spend more time with his family, this was exactly the reason why Mr Adami had handed in his resignation. It was a tragic death in his family that compelled him to vacate his office in Milwaukee and return to South Africa. Mr Adami will retire from full service on 30 November 2007.

Norman Adami decided that his family should take precedence over his career. Photo: SABMiller

Mr Adami, 53, who joined South African Breweries (SAB) in 1979, rose through the ranks to replace Graham Mackay as Managing Director of SAB in South Africa in 1994. In 2003 he was moved to the U.S. where he was charged with turning around the struggling Miller Brewing Company acquired by SAB in 2002. Over the last 12 months Mr Adami has overseen the successful integration of Colombia’s Grupo Empresarial Bavaria into the SABMiller group.

In the financial year ending 31 March 2007, the North American business accounted for 17 percent of volumes and 24 percent of SABMiller’s total sales. As concerns sales, Mr Adami headed the group’s major division.

Commenting on the announcement, Graham Mackay, SABMiller’s Chief Executive, said:

“Norman has made an enduring contribution to the SABMiller Group and we will greatly miss his wisdom, passion and commitment. One of Norman’s legacies is the strong management team that he has built up in the Americas. I respect Norman’s decision to move back to South Africa to support his family and we wish them all success and happiness in this new phase of their lives.”

Mr Adami will not be replaced in this position. Rather Tom Long, who is currently President and CEO of the Miller Brewing Company and Barry Smith, who is President of SABMiller Latin America, will report directly to Graham Mackay and will continue to serve as members of the SABMiller executive committee.

If someone knew the beer business in Africa, it was André Parker, who will be retiring at the end of September after 32 years of service with SABMiller. Under Mr Parker’s leadership, the Africa and Asia region has grown substantially with EBITA, turnover and volumes up almost four-fold over a period of eight years. In the financial year 2007, the region accounted for some 30 percent of group lager volumes and some 14 percent of sales revenue. If this figure seems low, it should be remembered that South Africa is an independent region within SABMiller and not included in the division headed by Mr Parker.

André Parker will retire after 32 years of service with SAB. Photo: SABMiller

In recognition of the current scale and future growth potential of the group’s Africa and Asia interests, from 1 October 2007 the region will be split into two management units.

SABMiller said that Ari Mervis will be appointed Managing Director SABMiller Asia and Mark Bowman will take up the role of Managing Director SABMiller Africa. Reporting directly to Graham Mackay the two will join the executive committee, effective 1 October 2007.

Currently Managing Director Australia, Ari Mervis was responsible for building SABMiller’s Russian business. He was recently transferred to Australia to establish the company’s presence there – the joint venture with Coca-Cola Amatil (we reported). Mr Mervis will head up a relatively small Asia hub office, located in Hong Kong, which will support SABMiller’s partnerships in China, Australia and Vietnam and the wholly-owned Indian business, and continue to grow SABMiller’s interests in the region.

Mark Bowman, who is currently Managing Director Kompania Piwowarska in Poland, has experience of both the beer and soft drinks businesses, having previously been Managing Director of the company’s South African bottling operation ABI. The Africa hub office will remain in Johannesburg, and will focus on further developing SABMiller’s beer and soft drinks operations on the African continent (outside of South Africa).

Obviously, there was much speculation among investors why Mr Parker decided to retire. One consideration was that at 56 years of age he was unlikely to replace Graham Mackay as Chief Executive.

Graham Mackay who is probably one of the longest serving CEOs of the brewing industry – and that is a success in itself - may not like people to talk about his succession but at the age of 58 he is more than a decade older than Carlos Brito (InBev), August Busch IV (Anheuser-Busch) or Jean-Francois van Boxmeer (Heineken). Given that investors and analysts seem to have succumbed to a yuf cult, it is only a matter of time before the issue of succession will gain some more urgency.