Gap names drug chain exec Murphy as CEO

By Alexandria Sage

LOS ANGELES (Reuters) - Gap Inc. (GPS.N: Quote, Profile, Research, Stock Buzz) on Thursday named Glenn Murphy as its new chief executive and chairman, giving a respected former Canadian drug chain chief with no significant fashion industry experience the mandate to turn around the world's largest apparel retailer.

Murphy, 45, is relatively unknown in the United States and his appointment generated mixed reactions from Wall Street. Shares of Gap, which ousted its previous CEO six months ago, rose 2 percent.

"I like the hire," said Susquehanna analyst Thomas Filandro, who argued that Murphy was good at "rethinking" brands. "I want to hear what he intends to do."

But C.L. King analyst Mark Montagna was more cautious.

"The problem is the guy does not have an apparel background," Montagna said. "That tells you that those people they asked in the apparel world all said no (to the job)."

Murphy most recently served as chairman and CEO at Shoppers Drug Mart (SC.TO: Quote, Profile, Research, Stock Buzz), the largest drugstore chain in Canada that operates more than 1,000 stores and had fiscal 2006 sales of $7.8 billion. Murphy, a Canadian, earlier held positions at Loblaw Cos. Ltd. (L.TO: Quote, Profile, Research, Stock Buzz), a retail and wholesale food company in Canada.

Shoppers Drug Mart's stock nearly tripled to C$51.15 between the time Murphy took it public in November of 2001 until he left in March of this year.

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