Bunge, a leader in agriculture, food and ingredients, announced that its Chief Executive Officer Soren Schroder will step down. To ensure a smooth leadership transition, Mr. Schroder, who has served as CEO since 2013, will continue in his current role until a successor is named.
Bunge Ltd (BG.N) Chief Executive Officer Soren Schroder is stepping down after five years at the helm of the global agribusiness following months of pressure from shareholders to shake up the company amid a prolonged grain market slump. Schroder will continue in his current role until a successor is named, the company said in a statement.
New York-based Bunge also appointed board member Kathleen Hyle as chairman, effective immediately, replacing L. Patrick Lupo. She most recently was the head of the audit committee on the company’s board. Hyle will be part of a search committee created to appoint a new CEO, along with Mark Zenuk, who was appointed to Bunge’s board in July, and Paul Fribourg and J. Erik Fyrwald, who joined the company’s newly expanded board in October.
The management change is the latest event to rattle the two-century-old commodities trader after a stretch of particularly weak earnings results beginning last year that left the company vulnerable to takeover attempts by rivals Glencore and ADM. The company in October bowed to the demands of activist investors D.E. Shaw and Continental Grain, adding four new board members and creating a strategic review committee that would explore all options for the company, including selling itself.
Bunge has been grappling with a global grains glut that has dragged down crop prices and thinned margins for trading grains. The U.S.-China trade war has slashed exports of U.S. crops to China, further depressing prices. The company’s strategy in recent years has focused on expanding higher-margin businesses such as food ingredients, but results have been slow to offset the challenges in its core trading and processing businesses.
Michael Underhill, chief investment officer at Capital Innovations, said he was glad to see Schroder step down because the CEO was too comfortable with the status quo at Bunge. “I don’t think he could be characterized as being an aggressive leader,” Underhill said. “Inconsistent execution has been a key element of the Bunge investment story in recent years and something that has kept us from being more positive.” Bunge is open to reengaging with both Glencore and ADM with the departure of Schroder, Bloomberg reported, citing a person familiar with the matter.
Mr. Schroder, 57, joined Bunge in 2000 and has held a variety of agribusiness leadership roles, including CEO of Bunge North America. His tenure has included a significant strengthening of Bunge’s core activities in agribusiness and growth in food and ingredients, notably with the recent acquisition of Loders Croklaan. Mr. Schroder has focused on creating a simpler, more efficient organization, establishing a series of global partnerships, building a first-class team and increasing Bunge’s focus on customers.