‘Very, very, very bad’: Red Lobster CEO Kelli Valade steps down after just 8 months | Nation

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Red Lobster CEO Kelli Valade is stepping down after just eight months at the helm of the Orlando-based seafood chain, a quick start that one industry analyst called ‘very, very, very bad’ .

A press release announcing Valade’s resignation did not give a specific reason for her departure, which she called “an incredibly difficult, yet necessary decision.” It is effective April 15.

“We have accomplished a lot in a short time, including building an excellent management team who, alongside the board, will drive the business forward to achieve our vision,” Valade said in the statement. .

Valade took over as CEO in August following the retirement of longtime brand executive Kim Lopdrup.

San Diego-based restaurant analyst John Gordon called the resignation “very, very, very bad.”

“No CEO anywhere wants to be on board a company for just eight months. That says it all,” Gordon said. work only eight months before some sort of irreparable breakdown occurs.”

Prior to joining Red Lobster, Valade was President and CEO of Black Box Intelligence since 2019 and prior to that she spent over 22 years at Brinker International, including as President of the Chili’s Grill & Bar brand.

“Kelli has a very, very, very strong reputation in the restaurant industry as a leader and in casual dining especially through his experience working his way up the ranks at Brinker, which of course has both Chili’s and Maggiano’s,” Gordon said.

Gordon said the resignation is a bad signal for future Red Lobster CEOs. He added that everything becomes uncertain in a company following the departure of a CEO.

“Stuff like this sends an icy chill through the management ranks,” Gordon said.

Those management ranks have changed in recent months, with David Schmidt revealed as the company’s new chief financial officer on March 14, Cijoy Olickal as chief information officer on March 28, and Patty Trevino as chief marketing officer on March 14. January 18.

When a tenure is as short as Valade’s time at Red Lobster, it could be a mismatch in what was expected by either the executive or the board compared to the actual situation, Ron Piccolo said. , chair of the Department of Management at the University of Central Florida.

“That would tell me it’s probably not a great culture or the financial circumstances are more difficult than it first appears,” Piccolo said. “Why so abruptly? It is not known whose choice it is to break off the relationship.

He added that it was unfortunate that this happened at such an important mark for Central Florida.

Red Lobster board member Paul Kenny is expected to act as a “liaison” between management and the company’s board during the transition, and the search for a replacement should begin immediately, according to the press release.

“On behalf of the Board of Directors, we thank Kelli for his service and accomplishments during his tenure as CEO, including navigating through the latest wave of the COVID-19 pandemic,” said Rittirong Boonmechote, Chairman of the Red Lobster Board of Directors, in The Version. “She helped us build a talented and highly capable management team to drive us forward. We wish Kelli the best for the future.

In 2020, seafood supplier and Red Lobster shareholder Thai Union and a group of investors acquired the remainder of the seafood restaurant company from private equity firm Golden Gate Capital. Thai Union is headquartered in Thailand and its seafood brands include Chicken of the Sea, John West, King Oscar and others.

The group of investors that was part of the acquisition included major shareholders Kenny, the former CEO of Asia’s Minor Food, and Rit Thirakomen, CEO and majority shareholder of Thai chain MK Restaurant Group.

The sale came following concerns from outside analysts over a maturing loan and as the coronavirus pandemic brought much of the restaurant industry to a standstill. Red Lobster, which has more than 700 restaurants, completed refinancing that debt last year.

Prior to this refinancing and sale, the loan had more than $355 million outstanding according to a June 2020 report from Moody’s.

Red Lobster’s operations “recovered significantly” in the fourth quarter of 2021, but had a rocky start to 2022 with the omicron variant of the coronavirus and higher costs, according to a presentation by Thai Union.

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