Today Sir Stuart Rose, former head of Marks and Spencer, has been named as the new Chairman of online supermarket Ocado. We answer five questions on Rose’s new role.
Who is Rose replacing at Ocado?
Rose will replace retiring chairman Michael Grade from the 10th of May following the online retailers Annual General Meeting.
As Chairman Rose will be tasked with turning the company around and ensuring the loss-making retailer becomes profitable as it expands its business with a new distribution centre in Warwickshire, which will open sometime this year.
How is Ocado doing in the current retail market?
Founded in 2000, Ocado is yet to make a profit. Most notably in November last year the company managed to raise £36m in share placing that enabled it to agree a vital refinancing with banks on £100m of debt it used to pay for the new distribution facility.
Its share price has fallen 47 per cent from 180 to 95 since it floated in 2010. In early trading today shares in Ocado rose 7 per cent.
What are Rose’s credentials for making a success of Ocado?
In 1972 Rose first worked at Marks and Spencer as a management trainee leaving in 1989. He then took up the role of Chief Executive of The Burton Group.
He rejoined Marks and Spencer in 2004 but courted controversy when he held both the Chairman and Chief Executive roles, which breaks corporate governance rules. However, during his time at the company he had successes such as the revival of Marks and Spencer’s clothing range and the successful TV ads featuring Twiggy and Erin O’Conner and Mylene Klass. He is said to not believe in retirement.
What has Ocado said about its new Chairman?
"Sir Stuart is joining Ocado as we enter a hugely exciting period, with a near doubling of our capacity. We are looking forward to benefiting from his extensive retail experience and counsel," said Ocado chief executive Tim Steiner.
What are retail analysts saying?
There has been speculation Marks and Spencer could enter a take over bid of Ocado as they have show interest in the past, but nothing official has been said.
Shore Capital analyst Clive Black told The Telegraph; "We are delighted to see Sir Stuart back in the sector. However, the evidence tends to suggest that bad companies will always beat good management.”