(Reuters) - Altria Group Inc MO.N said on Friday Chief Executive Officer Howard Willard has stepped down, ending a near two-year tumultuous term at the helm marked by heightened scrutiny of the tobacco giant's bet on e-cigarette maker Juul.
He will be succeeded by another company veteran, Chief Financial Officer Billy Gifford, who was last month named interim chief when the company disclosed that Willard had taken a medical leave of absence after contracting coronavirus.
Under Willard, 56, who was also the chairman, Altria invested billions of dollars to build stakes in e-cigarette maker Juul Labs Inc and Canadian pot company Cronos Group Inc CRON.TO to counter falling cigarette sales.
But the company has written down the value of its $12.8 billion investment in Juul by about $8.6 billion due to bans on e-cigarettes following a surge in teenage vaping and reported health-linked concerns.
The U.S. Federal Trade Commission earlier this month filed a complaint aimed at forcing the Marlboro cigarette maker to sell its investment in Juul. The company has said it would “vigorously defend” the investment.
“A CEO departure at a time of such change, combined with a missed opportunity to bring in someone new following damaged credibility post the Juul and Cronos deals, means this is a net negative,” Jefferies analyst Owen Bennett said.
Willard had forgone his annual incentive award as a result of the souring minority investment in Juul.
The company said on Friday that Willard - who is leaving after nearly three decades at the company - was recovering from the illness.
Altria is also separating the roles of CEO and chairman and on Friday named Thomas Farrell, formerly the board’s independent presiding director, to the role.
The company appointed finance and procurement vice president Salvatore Mancuso as Gifford’s replacement.
Shares of the company rose about 2% to $41.26 in afternoon trading. They have fallen nearly 20% this year.
Reporting by Aishwarya Venugopal in Bengaluru; Editing by Sriraj Kalluvila
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