McDonald's to replace chairman
Friday, December 6, 2002
CHICAGO -- McDonald's Corp. is replacing its chairman and chief executive, Jack Greenberg, as it struggles to emerge from a deep, two-year slump.
The fast food chain said Thursday that Greenberg, 60, decided to retire at the end of the month after 21 years at the company. McDonald's board elected the company's president and vice chairman, Jim Cantalupo, 59, to take over the top two spots.
McDonald's has reported lower earnings in seven of the past eight quarters and recently announced it is slowing its expansion pace as it grapples with a crowded restaurant market, sluggish economy, complaints about poor service and a depressed stock price.
Several Wall Street analysts had been urging for months that Greenberg be replaced.
McDonald's stock has lost about two-thirds of its value since Greenberg was named chief executive in 1998, and it fell to a seven-year low this fall.
McDonald's stock gained 41 cents to close at $18.78 Thursday on the New York Stock Exchange.
"In every company's history, there is a time when it is appropriate to pass the baton and give a new management team the opportunity to lead, and that time has come at McDonald's," Greenberg said in a statement.
Greenberg's retirement announcement comes nine months after McDonald's board asked him to remain CEO through 2005, and he accepted.
Restaurant consultant Jerry McVety, president of Farmington Hills, Mich.-based McVety & Associates, said the poor economy apparently sank Greenberg with shareholders.
"He was doing well when things were going well, and when things turned down they expected him to keep doing well," McVety said.
Cantalupo has worked for McDonald's for 28 years.
"We have challenges ahead, but I am extremely confident in our ability to succeed," Cantalupo said in a statement. "I am confident because I believe in the strength of our brand and the commitment of our people."