December 4, 2018 / 1:55 PM / 11 days ago

UPDATE 1-Struggling Spanish supermarket chain DIA names new senior staff

(Adds detail, shares, background)

MADRID, Dec 4 (Reuters) - Struggling Spanish supermarket group DIA on Tuesday announced a string of new senior hires in a bid to turn the business around, although the announcement failed to halt a further slide in its shares.

The retailer’s market share in Spain has steadily eroded over the past five years, as economic recovery reduced the appeal of a low-cost offering that was popular during a deep recession.

DIA said Enrique Weckert Molina, a former executive of builder OHL and fertiliser and chemical company Grupo Fertiberia, had taken over as group Chief Financial Officer.

He replaces former finance director Armando Sanchez Falcon, who was suspended from his role in October.

For its Brazilian business, DIA named Marin Dokozic, previously head of arch rival discounter Lidl in Germany, as CEO. Home-grown peer Mercadona and Lidl have stolen a march on DIA by investing more heavily in their stores.

“DIA is bringing in the sector’s best professionals to push ahead with an innovative turnaround,” Chief Executive Antonio Coto, a company veteran who took the helm in August, said in a statement.

But the positive message did not immediately feed through to the stock market: DIA’s shares had been among the worst performers on Spain’s IBEX index before the announcement and remained more than 6 percent lower on the day at 1320 GMT.

Dogged by short-selling of its stock, the company has lost more than 84 percent of its market value this year. It has issued three profit warnings in 12 months.

To help revive its domestic market, DIA named the former supply chain director of department store giant El Corte Ingles, Ivan Martin, as Spanish operations director.

In Argentina, which accounts for around 15 percent of group sales, Freddy Wu, who was previously in charge of the Brazilian operations, will become chief executive.

Takeover speculation has raged around DIA since September, when its biggest shareholder, Russian tycoon Mikhail Fridman’s LetterOne investment fund, revealed it held a 29 percent stake, just under the 30 percent threshold that would trigger a full buyout. (Reporting by Isla Binnie; Editing by Kirsten Donovan)

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