Former Tesco boss Sir Dave Lewis named CEO of struggling Diageo

Former Tesco boss Sir Dave Lewis has been named as the next chief executive of struggling drinks giant Diageo.

Lewis, who served as Tesco CEO between 2014 and 2020, will be tasked with steering a turnaround of the Smirnoff vodka and Captain Morgan rum maker.

Diageo, which also owns Guinness, has seen weaker demand and sluggish sales growth since a lockdown-era peak, driving the group’s share price to its lowest level in a decade and leaving it vulnerable to opportunistic takeover bids.

Replacing interim boss Nik Nhangiani after former CEO’s Debra Crew abrupt departure in July, Lewis will join Diageo at the start of next year.

Lewis was hired by New York-based buyout group Clayton, Dubilier & Rice in January last year as an operating adviser tasked with ‘identifying and evaluating new investment opportunities’.

He spent almost three decades at Unilever before taking over at Tesco where he oversaw a dramatic turnaround in the retailer’s fortunes. He is also current chair of consumer healthcare giant Haleon, a role he will step down from.

Sir Dave Lewis spent almost three decades at Unilever before taking over at Tesco

Sir John Manzoni, Diageo’s chair, said Lewis ‘has both the extensive CEO experience, and the proven leadership skills in building and marketing world-leading brands, that is right for Diageo at this time’.

He added: ‘We are confident that Dave will work with the team to take Diageo into its next successful chapter in the evolving consumer environment.

Lewis said ‘Diageo is a world leading business with a portfolio of very strong brands, and I am delighted to be joining the team.

‘The market faces some headwinds but there are also significant opportunities. I look forward to working with the team to face these challenges and realise some of the opportunities in a way which creates shareholder value.’

Investors responded well to the appointment, with Diageo shares soaring 7 per cent at the open to 1,847.5p. 

Head of markets at Interactive Investor Richard Hunter said: ‘The announcement is clearly being seen as a potential inflection point for the group given the new hire’s proven ability in brand building, and where the shares have been under some considerable pressure of late, having fallen by 28 per cent so far this year. 

‘The news may prompt investors to reconsider the strength of Diageo’s premier brand portfolio.’

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