Barry Callebaut CEO Exits Amid Strategic Disagreement Over Cocoa Unit

Leadership Changes at Barry Callebaut

By Oliver Hirt, May Angel and Amy-Jo Crowley

Reasons for CEO Departure

ZURICH/LONDON, Feb 2 (Reuters) - Barry Callebaut and its former CEO Peter Feld parted ways last month after a previously unreported clash at the top of the world's largest chocolate maker over a proposal to separate its cocoa business, two sources told Reuters.

Board's Strategic Direction

Members of Barry Callebaut's board, including its chairman Patrick De Maeseneire, opposed the plan, the sources said. Cocoa accounted for 31% of Barry Callebaut's total sales revenue and 15.5% of its operating profit in 2024/25.

Future of Cocoa Business

Reuters reported in December that Barry Callebaut was in the early stages of looking into separating the lower-margin cocoa unit and possibly selling a minority stake at a later stage.

Feld and De Maeseneire did not respond to Reuters emails and calls seeking comment on the split within Barry Callebaut's leadership or the CEO's sudden exit from the Zurich-based firm.

Barry Callebaut, which supplies chocolate for Magnum ice cream and Nestle KitKat bars, named ex-Unilever boss Hein Schumacher on January 21 to replace Feld, who joined the Swiss company as chief executive in 2023.

"One reason for the departure was diverging views regarding the company's future strategy," a person with knowledge of the matter told Reuters, asking not to be named because they were not authorised to speak publicly.

"The CEO was open to considering a separation of the cocoa unit and a potential transaction, but for parts of the Board - led by the chairman - this was a non-starter," they added.

Barry Callebaut declined to comment on any disagreement between the former CEO and its board. It said the Swiss company has a "fully integrated cocoa and chocolate business model".

'A NEW PHASE OF GROWTH'

One of the sources said that Barry Callebaut's board, which had initially been more supportive of a split, backed off from the idea, leading to a clash with Feld over strategy at the company, whose ingredients are used in about one in four chocolate and cocoa products consumed globally. 

Both sides agreed that a change was needed, the source said, adding that there were also other areas of disagreement, including on the level of investment in digitalization.

Reuters earlier reported that the proposal for separating the cocoa business was aimed at reducing Barry Callebaut's exposure to volatile prices for the chocolate ingredient.

Cocoa demand has collapsed after a 2024 price surge, falling to 21-year lows in the fourth quarter of last year in Europe as chocolate makers shrink product sizes and reformulate recipes.

Barry Callebaut processes almost 1 million metric tons of cocoa a year, a fifth of global volume, and so is more exposed to price fluctuations than consumer-facing chocolate firms, who outsource some production to companies such as the Swiss group.

Separating the cocoa processing arm could allow Barry Callebaut to protect itself from commodity price swings, focus resources on its higher-margin chocolate business and optimise its financing, sources previously told Reuters.

The second source, who is close to the company, also said that there had been disagreement within the higher ranks of Barry Callebaut over the idea of separating the cocoa business.

In an internal memo to employees seen by Reuters, Barry Callebaut said that with its transition programme nearly complete and the company moving to "a new phase of growth", now was the right time for a CEO transition.

Schumacher was "the right leader at this stage to chart Barry Callebaut's next phase... based on our fully integrated cocoa and chocolate business model", the memo read.    

Artisan Partners, which has a stake of some 10% in Barry Callebaut, welcomed Schumacher's appointment and indicated it should keep the cocoa unit which gives it "vertical integration".

"I think it's just a competitive advantage," David Samra, a managing director at Artisan Partners, told Reuters. 

(Reporting by Oliver Hirt, May Angel and Amy-Jo Crowley. Additional reporting by Paolo Laudani, Danny Callaghan, Alexander Marrow and Andres Gonzales Estebaran. Writing by Anousha Sakoui; Editing by Adam Jourdan and Alexander Smith)