Starbucks taps former PepsiCo exec as CEO

Starbucks has named a longtime PepsiCo executive as its new CEO.

The coffee giant said Thursday that Laxman Narasimhan will join Starbucks on Oct. 1 after relocating from London to Seattle, where Starbucks is based.

He will work closely with Starbucks’ interim CEO Howard Schultz through April 1, when he will assume the CEO role and join the company’s board.

Narasimhan, 55, was most recently CEO of Reckitt, a U.K.-based consumer health, hygiene and nutrition company that makes Lysol cleaner and Enfamil formula, among other products. Reckitt had announced

Narasimhan’s surprise departure earlier Thursday.

Prior to that, Narasimhan held various leadership roles at PepsiCo, including as global chief commercial officer. He also served as CEO of the company’s Latin America, Europe and Sub-Saharan Africa operations.

Narasimhan has also served as a senior partner at the consulting firm McKinsey & Co., where he focused on its consumer, retail and technology practices in the U.S., Asia and India.

Schultz, a longtime CEO who helped shape Starbucks after buying it in 1987, came out of retirement and assumed the interim CEO job in March after the company’s former CEO, Kevin Johnson, announced his retirement.

Narasimhan takes over a company with significant strengths. Starbucks reported record demand in the April-June period as strong U.S. sales made up for continuing closings in China, the company’s second-largest market.

But Starbucks also has challenges. Schultz has been working on a plan to remake store layouts, upgrade equipment and bolster employees. Starbucks announced a $1 billion investment in employee wages and benefits last fall and added $200 million more for pay and other benefits in May. Still, the company faces an unprecedented unionization effort, which it opposes. At least 233 U.S. Starbucks stores have voted to unionize since late last year.