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Businessweek Archives

Douglas Ivester: Minding The Soda Fountain

In Business This Week: HEADLINER


When Coca-Cola announced on Sept. 8 that Chairman and CEO Roberto Goizueta was being treated for a lung tumor, investors began giving heir apparent Douglas Ivester a closer look. Coke's board wants Goizueta, 65, to hold the CEO slot indefinitely past his retirement. But industry observers predicted when Ivester was named president in 1994 that he would eventually get the nod.

Ivester, 50, is a veteran. The former accountant crunched numbers as Coke's chief financial officer, ran the European division, and headed U.S. operations beginning in 1990. But he really made his mark when he created the "49% solution" in 1986. Coke consolidated dozens of independent bottlers and took a 49% stake in the new outfit, giving Coke control while reducing its debt. Coke turned this into a corporate strategy, creating megabottlers around the world. Says one large bottler: "Coke won't miss a beat with Ivester at the helm."EDITED BY KELLEY HOLLAND By Nicole HarrisReturn to top


COLUMBIA/HCA HEALTHCARE IS taking a trip to the E.R. On Sept. 9, the hospital giant said third-quarter earnings would be lower than expected due to the effects of a sweeping federal probe of the company and related legal expenses. Columbia said quarterly earnings would fall between $123 million and $167 million, or 20 cents to 25 cents a share, from $311 million, or 46 cents a share, a year ago. Most of the drop was attributed to falling patient admissions and a $60 million charge for legal costs and severance payments for ousted CEO Richard Scott and other executives who fled after Thomas Frist Jr. took over on July 25. Frist says Columbia is working hard to respond to the probe and striving to put patient care first.EDITED BY KELLEY HOLLANDReturn to top


CUSTOMERS DIDN'T LOVE IT AT Levitz--at least not enough to keep it out of bankruptcy. Levitz Furniture filed for Chapter 11 protection on Sept. 5. The retailer opened its first store in 1910 and pioneered the warehouse-showroom concept in the '60s. Revenues for fiscal 1997 were $967 million. But it has been hurt by sliding sales, heavy debt, and stale merchandise. CEO Michael Bozic, hired in 1995, failed to turn the company around. Levitz will pull out of seven markets entirely and close two other stores, cutting 300 jobs.EDITED BY KELLEY HOLLANDReturn to top


FAMILY-FRIENDLY LEVI STRAUSS got a spanking on Sept. 9 when an El Paso judge held that it illegally discriminated against five disabled workers. The fine: $600,000 in compensatory damages--plus $10 million in punitive damages. Plaintiffs' attorney James Scherr claims participants in a Levi Strauss "reentry program"--intended to channel disabled employees back into the workforce--were exposed to various forms of harassment, including being ridiculed as "fakers, invalids, and liars." A spokesman says Levi's "believes the award was outrageous" and intends to appeal.EDITED BY KELLEY HOLLANDReturn to top


NO MORE SOUP-TO-NUTS AT Campbell Soup. On Sept. 9, the new CEO, Dale Morrison, announced that Campbell would be spinning off seven businesses that generate $1.4 billion in annual sales, nearly one-fifth of the company's total revenues. Those being shed include Swanson frozen foods and Vlasic pickles. Morrison says that the move will allow Campbell to focus on higher-margin businesses including soups, sauces, and baked goods. The news came a day after Campbell announced that fourth-quarter earnings rose 6%, to $192 million, on sales of $1.72 billion.EDITED BY KELLEY HOLLANDReturn to top

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