AT THE HELM: Tyson Names New CEO

SMITH CHOSEN BY BOARD FROM WITHIN MEAT GIANT’S RANKS

By Kim Souza

Posted: November 20, 2009 at 4:28 a.m.

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SPRINGDALE — Tyson Foods tagged one of its own — 50-yearold Donnie Smith — to lead the meat giant into 2010.

Thursday morning, Tyson’s board of directors named Smith, a 29-year company veteran, as its next president and chief executive off cer.

search. Tollett was recalled as CEO in January by senior chairman and majority shareholder, Don Tyson, following the sudden departure of former CEO Dick Bond.

Smith has headed up the company’s poultry and prepared foods divisions since January, working directly with Tollett.

Prior to that, Smith held several management positions in purchasing, environmental, manufacturing Interim CEO Leland Tollett then passed the torch to Smith putting an end to the company’s 10-month services, logistics and food safety. Smith also worked in live poultry production and commodity procurement.

“I am humbled and honored to serve in this new capacity. You won’t hear me say, ‘I run Tyson Foods.’ No one person can do this job. I have been given the privilege to serve and lead a management te am that lead s other management teams that run this company,” Smith said.

Smith added that he will focus on providing leadership, direction and empowerment to his management team to better serve Tyson customers.

“Our company will grow when our customers grow,” Smith said.

A graduate of the University of Tennessee, Smith said he set out to be veterinarian but changed his career plans after three years of study.

He said achieving the CEO post for the second-largest food company in the Fortune 500 was not part of his original playbook.

“If the job I had at 7:30 this morning (Thursday) was as far as my journey went with Tyson Foods, I would have been deliriously happy. The sum total of my 29 years have helped prepare me for the new tasks at hand.” Smith said.

Industry analysts were not the least bit surprised by Smith’s appointment.

Tollett hinted earlier this year that the company was looking hard within its own ranks for the next management team.

“We think Smith’s experience in poultry will be a plus, given the challenges the poultry business has posed to Tyson’s financial health. We applaud Tollett for his excellent management of the company these past 10 months,” said Ann Gilpin, independent analyst with Morningstar.com.

Tollett is credited with ordering production cuts and monitoring costs that eventually returned the chicken segment to profi tability.

The 71-year-old Tollett said in January he would serve as long as it took to get the company back on course. “That time is now,” he said following the recent announcement.

“The chicken business will likely go through some changes and challenges in the coming year or so when JBS takes over Pilgrim’s Pride,” said Steve Kay, publisher of Cattle Buyers Weekly. “Tyson made a safe bet choosing Smith.”

Jim Lochner was also promoted by the Tyson board on Thursday. Lochner has been with Tyson since the company acquired IBP in 2003. He has headed up the company’s fresh meat division and will be returning to Springdale from Dakota Dunes, S.D., to serve as chief operating offcer, a position that has been vacant since 2006, when Dick Bond left that post to become CEO.

“The time is appropriate for Jim to return to Springdale in this elevated role. He is credited with cleaning up Tyson’s beef business following its $244 million operating loss in 2006,” Kay said.

Under the new management structure, replacements for both Smith and Lochner will be named in the next two weeks. Tollett will stay on to assist in the management transition.

Both Smith and Lochner have been instrumental in refocusing the company to a “back to basics” approach that has helped earnings profitability, said Stephens Inc. analyst Farha Aslam. Stephens conducts investment banking services with Tyson Foods Inc. and is compensated accordingly.

Aslam expects the transition to be smooth, given both executives are Tyson veterans.

Analysts agree that Tyson Foods has a unique corporate culture, one that may not be attractive for some executives. Unlike most publicly traded companies, the Tyson family retains control through a dual class voting system.

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