After being Krispy Kreme Doughnuts, Inc.'s CEO for the past 6 years and working for the company since 1977, Scott Livengood is being replaced by Stephen Cooper, the specialist who led Enron and Laidlaw out of bankruptcy. Bloomberg.com reports that Livengood has decided to retire after the SEC lauched its federal investigation into the company's financial practices (see Blog entries of 12/17/2004 and 12/28/2004) and the company's stock price fell 76%. Fund managers speculate that Livingood failed because he had little experience in running a public company or because he expanded Krispy Kreme too quickly. Others, including plaintiffs in a shareholder class action, accuse Livengood and other officers of the company of knowingly filing false financial reports.
In any event, investors hope that the introduction of new management will be enough to turn the troubled company around.