Veteran Cargill executive David W. MacLennan will take the reins of the agribusiness giant later this year, heading one of the world’s largest private companies at a time when it is pouring investment dollars into fast-growing international frontiers from Asia to South America.
MacLennan, Cargill’s 54-year-old president and chief operating officer, succeeds Greg Page, who will become the company’s executive chairman. Page, 62, has been Cargill’s CEO since 2007, presiding over a period of expansion and mostly strong profit growth.
MacLennan said after Wednesday’s announcement that he was honored by the appointment, which takes effect Dec. 1, and will seek continuity with the course set by the Minnetonka-based company’s senior leadership team in recent years.
“I believe in our strategy and the strategic foundations set out under Greg,” he said in an interview.
The changing of the guard doesn’t occur too often at Cargill: MacLennan will become only the ninth CEO of one of Minnesota’s oldest companies, founded in 1865 and rooted in the state’s agricultural past.
Today, it’s one of the most global U.S.-based companies, yet it’s still owned mostly by ancestors of the Cargill and MacMillan families, the company’s longtime stewards. About 100 descendants own about 90 percent of Cargill’s stock.
Cargill employs about 140,000 worldwide and has vast interests in 65 countries, from grain handling to cocoa to road salt to processed meat to financial services. Minnesota’s largest company, Cargill had $137 billion in revenue and $2.3 billion in profits in its fiscal year that ended in May.
Long-standing transition period
MacLennan has held various leadership positions at the company in its financial, energy and meat-processing segments. He became the company’s chief financial officer in 2008, the same year he was elected to Cargill’s board. Since 2011, MacLennan has been chief operating officer, often a steppingstone to the CEO suite.
MacLennan said Cargill’s challenges include maintaining growth in a complicated world economy fraught with competition. With Cargill’s heft, it’s not only a giant supplier to global companies, it’s a key player in the world’s food supply system.
That puts it at the heart of issues — sometimes controversial — about growing global food demand. “Being as big as we are, there is always something interesting happening in the Cargill world,” MacLennan said.
The announcement capped a transition period that had been taking shape for a year and a half. “To us this is no surprise,” said Chris Johnson, an analyst at Standard & Poor’s who covers Cargill’s publicly traded debt.
“We were expecting that possibly David or a couple of other senior executives would replace Greg Page,” Johnson said. “At a senior management level, we think there has been good succession planning [at Cargill.]”
MacLennan was born in Boston and raised partly in Chicago and partly in the Twin Cities. He graduated from Edina East High School. He has a bachelor’s degree from Amherst College and an MBA from the University of Chicago.
MacLennan started his career as a runner and clerk at the Chicago Board of Trade, heart of the nation’s agricultural commodity business. “That’s where I cut my teeth on markets, futures and risk,” he said.
He joined Cargill in 1991, working his way up to become chief financial officer of Cargill Financial Services before leaving the company in 2000 to head the bond department at U.S. Bancorp Piper Jaffray. While he called his stint at Piper a “great experience,” MacLennan returned to Cargill in 2002, landing a job in the company’s Geneva office.
Many peaks, one valley for Page
Page, 62, has been with Cargill since 1974, and his CEO stint featured mostly good times for the firm. Five of Cargill’s six most profitable years — in terms of sheer volume of earnings — came during Page’s stewardship. Company revenue grew from $87 billion to $137 billion from 2007 through 2013.
“I would like to think we made progress across a host of initiatives,” Page said in an interview after the change was announced Wednesday. “We really set out to broaden the company, to globalize the company.”
During his tenure, Page said, 75 percent of Cargill’s capital deployment has been outside of the United States, with major investments in such large and growing countries as China, India, Russia and Brazil. “We’ve moved the center of Cargill closer to to the center of the world’s economy,” he said.
Page’s tenure has been marked by some key acquisitions, with the $2.2 billion buyout of Dutch animal feed provider Provimi in 2011 as the biggest. But he also found himself steering Cargill through one of its worst years in a decade in fiscal 2012.
Cargill posted its lowest annual profit that year since 2003, as volatile markets hurt its trading operations while the company’s sugar, cotton and U.S. beef business also suffered. Cargill even announced a rare layoff of about 2,000 people or 1.5 percent of its global workforce, including fewer than 250 in Minnesota.
Currently, Cargill employs about 5,900 in Minnesota, mostly in professional positions in the Twin Cities.
Page is nearing Cargill’s mandated retirement age of 65. As executive chairman, he will chair the company’s board and continue to be a public face for Cargill, notably with policymakers.
Cargill also said Wednesday that Emery N. Koenig, its chief risk officer, had been appointed a vice chairman, a position that reports to the CEO. Paul Conway will continue to serve as vice chairman.