By Saabira Chaudhuri
LONDON-- Wm. Morrison Supermarkets PLC, Britain's fourth biggest
supermarket chain, said Wednesday it has appointed industry veteran
and former Tesco executive David Potts as its new chief executive
officer, replacing Dalton Philips who left the role earlier in
February after five years at the helm.
Mr. Potts has 40 years in grocery retailing, starting at Tesco
in 1973 on the shop floor, rising to become retail director in the
U.K. and chief executive of its Irish businesses. Since leaving
Tesco in 2011 he has acted as a retail expert for several
international advisory and private equity businesses.
Analysts aren't all convinced that Mr. Potts is the right man
for the job, however. "The job is a very tough one and David has
not previously had CEO experience," said Exane BNP Paribas' analyst
John Kershaw. "It could be argued that David Potts in part oversaw
the demise of Tesco." Still, Mr. Kershaw also said "Mr. Potts was
an able operator and a very good motivator of staff."
Shore Capital analyst Clive Black was more optimistic. "We
believe that David Potts' expertise on the U.K. market made him the
prime candidate for the role," said Mr. Black. "We believe that he
will bring focus and pace to Morrisons."
With the handover of the top role at Morrisons, three of the
U.K.'s "big four" supermarkets have changed CEOs in the past 10
months, reflecting a period of unprecedented turmoil for the group.
The group has been losing customers to high-end grocer Waitrose and
discount chains such as Aldi and Lidl, which are rapidly expanding
and benefiting from an improving customer perception of
quality.
The appointment of Mr. Potts now means that all three of
Morrisons' top executives previously worked for rival Tesco, which
analysts say is a plus since they will likely get along. Trevor
Strain, who has been chairing the management board and covering Mr.
Philips' executive responsibilities since February, worked at Tesco
in a number of roles including as finance director of the
behemoth's U.K. property group and its U.K. planning and reporting
group. Andrew Higginson, who became chairman at Morrisons in
January, was a Tesco board director for 15 years.
Morrisons has been cutting prices in a bid to take share from
its larger rivals, while fending off Aldi and Lidl. Earlier this
month, it said it was cutting prices across a range of basic items
such as bread, milk, butter and sugar. Its moves come as Tesco's
new CEO Dave Lewis has announced his own slew of initiatives,
including selling noncore assets, closing unprofitable stores and
reducing Tesco's product lineup.
The number four retailer by market share said Mr. Potts will
take on his new role from March 16 and be paid a salary of 850,000
pounds ($1.3 million) a year, the same as his predecessor.
Ian Walker contributed to this article.
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
Access Investor Kit for Wm Morrison Supermarkets Plc
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=GB0006043169
Access Investor Kit for Wm Morrison Supermarkets Plc
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US92933J1079
Subscribe to WSJ: http://online.wsj.com?mod=djnwires