Krispy Kreme Names CEO; Shares Jump

Food industry veteran Daryl G. Brewster has been hired as chief executive and president of doughnut chain Krispy Kreme Doughnuts Inc., the company said Tuesday.

Brewster, who will also join Krispy Kreme's board, previously served as president of the North American snacks and cereals business of Kraft Foods Inc.

Shares soared more than 20% on the news, closing at $7.71.

"I'm very excited to come here," Brewster said in a telephone interview from the company's headquarters in Winston-Salem, N.C. "This is a storied brand that will celebrate its 70th anniversary next year."

Stephen Cooper, the company's interim CEO since January 2005 and chairman of turnaround firm Kroll Zolfo Cooper, has been named chief restructuring officer, Krispy Kreme said.

Once the darling of Wall Street, Krispy Kreme ran into trouble in May 2004, when the company warned of a coming earnings drop it blamed on the popularity of low-carbohydrate diets. The company's stock sank.

The stock plunge began a downward spiral that led to store closings, the ouster of longtime CEO Scott Livengood and the hiring of Cooper to try to revive the company. A report by a special committee of independent directors blamed Livengood and former Chief Operating Officer John Tate for most of the company's problems, saying they tried to "manage earnings" to meet Wall Street expectations.

In a statement, Chairman Jim Morgan said Brewster "brings with him not only a wealth of practical know-how, but also a solid understanding of the opportunities, as well as the challenges, currently facing Krispy Kreme."