Changes at the top of Boots and M&S
The Mirror – 16 December 2002
John Cassy
British retailing is set for yet another management shake-up with Boots preparing to bring in a new chairman and the retailer credited with reviving the fortunes of Marks & Spencer set to embark on a pounds 300m new venture.
The chemist group confirmed yesterday that both chairman John McGrath and chief executive Steve Russell would leave. Respected industrialist Sir Nigel Rudd is expected to succeed Mr McGrath after next July's annual meeting. A search is under way for Mr Russell's replacement. Meanwhile, M&S chairman Luc Vandevelde is setting up a pounds 300m private equity business as he reduces the time he spends at the food and clothing chain from next month.
The moves come amid a period of unprecedented change in the management of Britain's leading retail chains. Top Shop owner Arcadia and catalogue chain Littlewoods have both changed hands this year.
Department stores House of Fraser, Allders and Harvey Nichols have all been involved in takeover talks.
The shake-up at Boots come at a time when supermarkets are providing growing competition for the sale of toiletries and over-the-counter medicines. Institutional investors are said to be uneasy at the way in which the Nottingham-based chain has responded to the challenge.
Mr McGrath said the issue of succession at Boots had been under consideration for several months but directors had decided to speed up the process "in order to drive strategic change faster". Mr McGrath said he would oversee the search for new chief executive, then retire.
"The search is proceeding well, and . . . we would expect to indentify a new chief executive in the near future," Mr McGrath said. "Steve will remain in his current role until a successor is found."
Sir Nigel, currently a non-executive director, has broad business experience, serving also as chairman of glassmaker Pilkington and formerly as boss of industrial conglomerate Williams Hold ings. Last week it emerged that headhunters had been appointed to find a new chief executive.
Marks & Spencer said yesterday that Mr Vandevelde would continue to devote around 60% of his time to the chain. He will also launch of a new private equity fund which will look to buy businesses across Europe.
The fund is unconnected to M&S but the group it was satisfied that the role carried no conflict of interest - even though Mr Vandevelde could look to buy European retail chains. The vehicle is being backed by the Halley family, the founders of the Promodes retail group which merged with French group Carrefour in 1999.
Mr Vandevelde remains close to the family after working for them at Promodes during the 1990s.
The Belgian has been hailed for the way he has restored profits and morale to M&S.
Over the last two years he has set about refurbishing stores, selling off overseas assets and improving product ranges.
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