Imperial announces new CEO from Inchcape Stefan Bomhard, currently CEO of Inchcape plc, will become CEO of Imperial Brands; his start date is not yet determined. Prior to Inchcape, Bomhard held senior roles at Bacardi, Unilever, Cadbury, Diageo/Burger King and Procter & Gamble. His wide range of experience across the Consumer sector is an asset that could re-invigorate Imperial’s internal culture. Likewise his experience across various geographies & channels, including emerging markets and Global Travel Retail, should prove useful. However, he has no experience in the highly regulated and fast changing world of Tobacco. Nevertheless, on balance we view his experience at various quality global Consumer companies to be a clear positive for Imperial shareholders. Imperial’s current CEO, Alison Cooper, has stepped down effective today; two divisional heads will act as interim CEOs until Bomhard arrives. What this means for Imperial’s strategy We note that Matthew Phillips has also stepped down as Chief Development Officer effective today. Phillips had been responsible for next generation product innovation as well as corporate and legal affairs. With the incoming CEO well known as a “marketing man” (he has a PhD in marketing), we expect a new strategy for next generation products is imminent. Imperial has been perceived – somewhat wrongly – as slower to expand in this area and we suspect efforts will intensify here. We would urge the new CEO to also consider divesting small, non-core and not very profitable positions in markets across Asia, Africa and Europe, and using the proceeds to pay down debt and buy back shares. Valuation still attractive Tobacco has had a modest bounce in the last few months, but we see further upside given the very low valuations. Our recent report [here] published last Friday examines recent developments in the sector.