LONDON (Reuters) - Marks & Spencer named Archie Norman as its new chairman on Friday, with the 63-year-old retail veteran’s appointment lifting the clothing and food retailer’s shares.
Norman, who helped to revive food retailer Asda in the 1990s, will join M&S at a critical time. The company’s food business is thriving, but its clothing division has struggled to deliver growth for more than a decade.
“I‘m under no illusions about the extent of the challenge facing the business,” Norman told Reuters.
M&S shares rose as much as 6 percent as investors welcomed the appointment of Norman, whose CV is packed with UK and international experience, including an extensive track record in the retail industry.
M&S said Norman would become non-executive chairman on Sept. 1, succeeding Robert Swannell, who will retire from the board having served six years in the job.
Norman will receive an annual salary of 600,000 pounds ($776,040) for the chairmanship, which although part-time is one of the most prestigious in corporate Britain.
Analysts said Norman’s turnaround experience could be highly valuable to M&S.
“The combination of Norman and (CEO Steve) Rowe should be a force for good for M&S ... we welcome this appointment,” said Shore Capital analyst Clive Black, who has a “hold” rating on the stock.
Others, however, said there was a danger Norman could go beyond the chairman’s brief of running the M&S board and keeping investors onside.
“It will be interesting to see how much of a ‘back-seat driver’ Archie Norman is to CEO Steve Rowe,” independent retail analyst Nick Bubb said.
Norman was a member of a three-strong team that established and built general merchandise retailer Kingfisher in the 1980s.
When Norman joined Asda as CEO in 1991, the supermarket was on its knees, but he transformed the business and then sold it to Wal-Mart in 1999 for a multiple of eight times its starting share price.
He has also chaired broadcaster ITV and been deputy chairman of Australian retailer Coles. He currently chairs investment bank Lazard in London and craft retailer Hobbycraft and is an advisor to Wesfarmers.
He worked for management consultants McKinsey before joining Kingfisher.
Norman is also well-connected politically, having served for eight years as a member of Britain’s lower house of parliament, representing the Conservative Party in Tunbridge Wells, southern England.
“Having conducted a very rigorous appointment process, it was clear to us that Archie was the best person to be chairman,” said Vindi Banga, M&S’ senior independent director.
On Wednesday, M&S said it had hired Halfords boss Jill McDonald to head the clothing division, freeing up Rowe to concentrate on running the overall company. McDonald will also join in the autumn.
Swannell will leave M&S having steered a smooth succession for the chairman’s job.
Shares in M&S were up 4.9 percent at 17.6 pence at 1053 GMT, valuing the business at 6.1 billion pounds ($7.9 billion).
($1 = 0.7732 pounds)
Editing by Alexander Smith and Jane Merriman