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Mattel taps ex-Kraft CEO
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May 17, 2000: 9:15 a.m. ET
No. 1 U.S. toy company names Robert Eckert to succeed Jill Barad
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NEW YORK (CNNfn) - Barbie's got a new boss.
The board of El Segundo, Calif.-based Mattel Inc., which makes Barbie and Hot Wheels cars, on Wednesday named former Kraft head Robert Eckert as the company's new chief executive officer.
Eckert, who resigned from Kraft to take the job, succeeds former Chairman and CEO Jill Barad, who was forced out after a succession of miserable quarters.
 The appointment to take the top spot at the No. 1 U.S. toy maker, ends a three-month executive search and is effective immediately.
"Bob Eckert combines all the attributes that we believe our chairman and CEO should possess. At Kraft, he clearly demonstrated his leadership, successfully managing a business with $17.5 billon in revenues for 1999, while increasing its sales and profits," said William D. Rollnick, Mattel's chairman.
"Mr. Eckert was our first and only choice for this post," Rollnick said. "He will give our company a clear vision about the direction of the business."
The news sent Mattel (MAT: Research, Estimates) shares up 1-1/8 to 12-3/8 in afternoon trading Wednesday.
Eckert's appointment also prompted Salomon Smith Barney to upgrade its rating of Mattel to "buy" from "neutral."
 "We believe the stock is washed out, and the new management announcement of Robert Eckert to the chairman and CEO position is a major positive," Salomon Analyst Jill Krutick said in a research note Wednesday. "Mr. Eckert brings a very solid, stable track record to a company that has had inconsistent performance and a tumultuous period."
Krutick said she is optimistic that Eckert can effectively fill several vacant management positions, lagging international and core product performance and to carry through the sale of The Learning Co., Mattel's troubled software unit.
Eckert brings a solid track record in a significantly larger consumer goods business, Krutick said and has a reputation as a strong, consistent operating manager of many diverse businesses with an eye toward cost-cutting.
However, Krutick cautioned that Eckert, who lacks any significant international experience, faces a challenge in helping boost Mattel's overseas sales as well as reversing a trend toward shrinking demand for its core products.
"Cheese, while a consumer product, is very different than toys which can be fad-driven," Krutick said.
Krutick also said she believes Mattel can trade into the mid-to-high teens. The company's shares have dipped as low as 8 from a 52-week-high of 30.
Former CEO Barad was ousted by Mattel's board of directors in February after a three-year reign. Barad, one of the most prominent female executives in the United States, had been with Mattel since 1981, working her way up from product manager to CEO in 1997.
As CEO, Barad helped resurrect sales of the popular Barbie dolls and accessories, but angered investors after leading the company's $3.5 billion purchase of The Learning Co., Mattel's faltering interactive unit. The computer software firm cost Mattel $105 million in third-quarter losses and another $183 million in fourth-quarter losses.
Nevertheless, the board gave Barad a $50 million severance package, prompting criticism from New York State Comptroller Carl McCall, sole trustee of the New York Common Retirement Fund, which owns more than 1.2 million Mattel shares.
"It is disturbing to hear that the board has elected to reward the person who presided over [Mattel's] precipitous decline," McCall said.
The toy company's stock has fallen from a high of $46 in 1998 to about $11 recently. Meanwhile, Mattel employees have continued to desert the company.
Eckert, however, is upbeat about joining El Segundo, Calif.-based Mattel, which owns such well-known toy brands as Fisher Price, Hot Wheels and Cabbage Patch Kids.
Eckert joined Kraft, the No. 1 U.S. food maker, in 1977 and had been its chief executive since 1997. His successor at Kraft will be Betsy Holden, who has been executive vice president since 1998.
Eckert leaves amid reports that Kraft's parent company, Philip Morris (MO: Research, Estimates), is among the companies interested in bidding for Nabisco Group Holdings (NGH: Research, Estimates), the holding company that owns 80 percent of Nabisco Holdings Corp. (NA: Research, Estimates), itself the maker of such brands as Grey Poupon mustard and Oreo cookies. 
--from staff and wire reports
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Mattel
Philip Morris
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