Financial News

  • 29 July 2014, 10:51

Ex-Tesco Chief To Chair Struggling Morrisons

A former finance director of Tesco is to become the next chairman of Wm Morrison, the UK's fourth-biggest grocer, as it combats falling sales amid competition from lower-priced rivals.

Sky News can exclusively reveal that Andrew Higginson, who left Tesco in 2012, is poised to be named as the successor to Sir Ian Gibson, who announced last month that he would step down.

A stock exchange announcement confirming Mr Higginson's appointment will be made this week and could come as soon as Tuesday, a source close to the situation said.

The arrival of Mr Higginson will add some crucial experience of the intensely competitive supermarket industry to Morrisons' board.

The Bradford-based retailer has struggled to keep pace with rivals, prompting Dalton Philips, its chief executive, to unveil a significant price-cutting campaign aimed at taking the fight to Aldi and Lidl.

Last month, it announced that it was cutting 2600 jobs in order to eliminate tiers of management within its stores.

It also sold Kiddicare, the baby good retailer, incurring an embarrassing loss three years after buying it as a staging-post towards launching a full online food retailing operation.

Since the original deal, Morrisons has struck a partnership with Ocado, the price of which was widely seen in the City as being expensive for the supermarket chain.

One analyst said that Morrisons' appointment of Mr Higginson, who is also senior independent director of BSkyB, owner of Sky News, was likely to trigger his departure as the chairman of Poundland, the discount retailer which floated on the stock exchange earlier this year.

It is unclear whether he will remain as chairman of N Brown, the internet and catalogue home shopping group.

A non-executive director of the Rugby Football Union, Mr Higginson also led an unsuccessful bid last year to acquire more than 300 Royal Bank of Scotland branches.

Mr Higginson spent 15 years at Tesco, including a stint as the finance director of Britain's biggest retailer.

He then took charge of its retailing services arm, comprising activities such as banking and telecoms, but left after being passed over for the chief executive's job at Tesco.

The man who was picked in his place, Philip Clarke, was ousted last week after three years of poor sales performance and discontent in the City.

Mr Philips is also under pressure, although any suggestion that Mr Higginson will make an immediate decision about Morrisons' future leadership is likely to be inaccurate.

Sir Ken Morrison, a member of the company's founding family, used its annual shareholder meeting last month to accuse Mr Philips of "talking b******t", although people involved with the business pointed out that the current boss had been left to deal with a deluge of problems inherited from predecessors.

A weekend newspaper report said that candidates for the Morrisons chairmanship included John Gildersleeve, another former Tesco executive; Allan Leighton, the ex-Asda boss; and Archie Norman, who chaired Asda.

However, insiders confirmed that none of those three men had been approached or held discussions about the role.

Morrisons declined to comment on Monday, while Mr Higginson could not be reached.

The search was carried out by MWM Consulting, a leading City headhunter.

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