Whitbread moves FD to lead Costa drive overseas
By Matt Scuffham
LONDON (Reuters) - British leisure group Whitbread WTB.L is moving highly-regarded finance chief Chris Rogers to head up its coffee shop chain Costa Coffee, with a remit to deliver ambitious overseas expansion plans.
Whitbread, which also owns budget hotel chain Premier Inn, said on Tuesday Rogers would become managing director of Costa in August and drive forward a five year plan to expand it to 3,500 stores worldwide.
Costa is already Britain's biggest coffee shop brand with almost 1,400 shops and has a further 800 units in 25 overseas markets, including China and India.
The appointment of Rogers, who has been Whitbread's finance director for the past seven years, is likely to heighten talk that Costa could eventually be demerged.
Some analysts have suggested Costa could be spun out of Whitbread to realize value for shareholders as it has few synergies with the group's other major business, Premier Inn.
Deutsche Bank analyst Geof Collyer said the appointment would be met with a combination of relief that the highly-rated Rogers will not be leaving Whitbread and speculation that Costa is being lined up for a demerger.
Collyer said he believed Costa should remain within the group for some time so shareholders can benefit from the significant growth expected from the expansion plans.
"If demerger was a near term option, why is the MD (managing director) leaving? We see an early demerger of Costa as potentially limiting the realizable value from the Costa growth plans for investors," Collyer said. Continued...