(Reuters) – Chipotle Mexican Grill Inc (CMG.N) on Tuesday said it had hired Brian Niccol from Yum Brands Inc’s (YUM.N) Taco Bell unit as chief executive officer to turn around the burrito chain that has been hurt by a series of food safety lapses.
Shares of Chipotle were up 11 percent at $279 in extended trading. They had hit a high of $742 in 2015, before sales-crushing E.coli, Salmonella and norovirus outbreaks sickened hundreds of U.S. customers.
Niccol, who has headed Taco Bell since 2015, replaces Chipotle founder Steve Ells.
Taco Bell is known for less expensive “fast food” compared with Chipotle’s made-to-order burritos.
The older brand got a turnaround fueled by Doritos Locos Tacos, a hit product introduced in 2012, under the leadership of Greg Creed, who is now CEO of the fast-food chain’s parent company, Yum Brands.
The run continued under Niccol, who joined the chain in 2011, was president from 2013 to 2014 and became its CEO in 2015 and launched breakfast and mobile ordering at Taco Bell.
Chipotle credited Niccol with expertise in digital technology, branding and restaurant operations.
Ells said in November he would step aside after failing for two years to rescue the burrito chain’s sales and reputation.
He became sole CEO after co-CEO Monty Moran departed in December 2016, under pressure from hedge fund manager William Ackman, whose Pershing Square Capital Management LP is Chipotle’s largest investor with a 10 percent stake.
Reporting by Lisa Baertlein in Los Angeles and Vibhuti Sharma in Bengaluru; Editing by Anil D’Silva and Lisa Shumaker