Chipotle Founder To Step Down As CEO After Its Comeback Falters
Chipotle Mexican Grill (CMG) founder Steve Ells will step down as chief executive officer after struggling to pull the burrito chain out of a two-year slump.
XAutoplay: On | Off Ells, who started the company in 1993, will hand over the reins once a new CEO is found, the Denver-based company said on Wednesday. He will continue as head of the board, taking the title of executive chairman.
Chipotle has struggled to bounce back from an E. coli crisis in 2015 that sickened customers around the U.S. The company had begun to restore its reputation in the past year, but a norovirus incident in Virginia and a viral video of mice at a Dallas location sparked a fresh round of negative headlines.
“It is clear that we need to move faster to make improvements,” Ells said in a statement. “Simply put, we need to execute better to ensure our future success.”
Chipotle also suffered a data breach earlier this year, an incident that hurt its earnings and contributed to another stock slump. This year’s hurricanes hammered Chipotle as well. It had 425 restaurants in the direct path of the storms.
Bill Ackman, the billionaire hedge-fund manager, is Chipotle’s biggest investor. His firm, Pershing Square Capital Management, took a 10% stake in the burrito chain last year. He described the company as an undervalued business with a “strong brand, differentiated offering, enormous growth opportunity and visionary leadership.”