Starbucks has announced that Chipotle CEO Brian Niccol will become its new CEO in a major shakeup.
The coffee chain is under pressure from activist investor Elliott Investment Management to improve its performance and share price.
Starbucks shares rose 20 percent in early trading on the news, while Chipotle shares fell more than 9 percent.
Chipotle CEO Brian Niccol (pictured) will become Starbucks’ new CEO
Seattle coffee chain sees less pressure from activist investors
Niccol will take up his new role on September 9, replacing current CEO Laxman Narasimhan, just a year and a half after he took over.
Starbucks has been in negotiations with Elliott Investment Management for weeks over the company’s declining sales and operational problems.
According to the Wall Street Journal, another activist investor, Starboard Value, took a stake in the Seattle company last week.
Starbucks reported disappointing results in its latest earnings report, showing comparable-store sales fell 2 percent.
Profits fell 7.5 percent in the second quarter, with the company blaming higher wages for its U.S. workforce, which offset higher prices.
