The boss of Morrisons is to resign as the grocer battles tough competition from discount rivals following its private equity takeover.
David Potts, who became chief executive nine years ago and oversaw the £7bn sale to Clayton, Dubilier & Rice in 2021, will hand over to former Carrefour France boss Rami Baitieh in November.
Analysts described Potts as part of a generation of great grocers and said his departure represented “a key moment” for the industry.
Chief executive David Potts resigns after nine years in the role
Potts, who began his supermarket career at a Tesco deli counter in Ashton-under-Lyne as a teenager, said working at Morrisons had been the “privilege of my working life”.
He said talks have been held with Morrisons chairman Sir Terry Leahy about a new chief executive since the acquisition by CD&R two years ago.
Mr Potts said: “We had a clear understanding that he was prepared to devote several more years to Morrisons if necessary, but that if an outstanding successor was identified who could lead Morrisons for the long term, then he would resign.” ‘
After taking a “short break” with his family, including his two children, Potts said he would “look at more ways to contribute to business and the UK’s economic recovery from the pandemic”.
Baitieh, who was born in Lebanon and moved to France to study at university, joined Carrefour in 1995.
He rose through the ranks to the top position in 2020, overseeing 5,800 stores.
After leaving Carrefour in August, Baitieh spent the summer “relearning to enjoy the simple things in life,” according to a post on his own Instagram page.
This included the opening of the Rugby World Cup in Paris. She was also part of the ‘jury’ for the Miss Paris 2023 pageant in June.
Baitieh said: “Morrisons holds a special place for shoppers across the UK and I am honored to be joining the business to help develop the strong links the business has with its loyal customers.”
In February this year, The Mail on Sunday revealed that CD&R had hired headhunter Egon Zehnder to scout candidates for top roles at Morrisons.
Tesco executive Jason Tarry was rumored to be one of the people who had been approached to replace Potts.
The 2021 acquisition was a debt-driven deal spearheaded by former Tesco boss Leahy, who worked for CD&R. Morrisons has been losing cash and market share since it fell into the hands of private equity two years ago.
The Bradford-based grocer racked up £1.5bn of losses in the year after its purchase, documents filed by Companies House this year revealed. Last October it was overtaken from first place as Britain’s fourth largest supermarket by the discount chain Aldi, according to the analysis firm Kantar.
In the latest tranche of data, Morrisons had a market share of 8.6 per cent, up from 10 per cent in
October 2021. It was criticized for its relatively high prices when customers first felt the effects of the cost of living crisis.
Its latest results yesterday showed sales were up 3 percent in the third quarter of the year.
Retail analyst Clive Black of Shore Capital described Potts’ departure as “a key moment in the history of British food retail”.
Aldi’s plan to target the middle class ALDI is targeting middle-class areas and university towns and cities as it accelerates its expansion.
Having overtaken Morrisons to become the country’s fourth largest supermarket, Aldi wants to open 500 more stores in the UK in the coming years to take the total to 1,500.
Part of the plan includes spending £1.4bn over the next two years on new sites and renovating existing ones, as well as expanding its distribution network.
Aldi’s list of target areas includes parts of London, from Kensington to Hackney, as well as university cities such as Newcastle, Nottingham, Cambridge, Birmingham, Cardiff and York. Other areas include Penzance, Bath, Maidenhead and Harrogate.
Shoppers have flocked to discounters Aldi and Lidl over the past year due to the rising cost of living.
Aldi said yesterday it was looking for sites in city centers or on the “edge of the centre”, as well as in retail parks.
It has been a year since Aldi overtook Morrisons to become Britain’s fourth largest supermarket. Aldi controlled 10.1 per cent of the market in the three months to September 3, according to research firm Kantar.
Richard Thornton, communications director at Aldi UK, said: “We are committed to continuing to invest until we can bring our quality products and unbeatable prices to as many people as possible.”
And Aldi chief executive Giles Hurley said he thought affordable food was a “right” and not a “privilege”.
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