* McIlwee exit adds pressure on struggling grocer
* Decision follows months of speculation
* Some analysts say McIlwee seen as a scapegoat
* Tesco struggling versus discount chains
(Adds comment, shares, background)
By James Davey and Neil Maidment
LONDON, April 4 Tesco's finance chief
Laurie McIlwee quit on Friday, delivering a fresh blow to CEO
Philip Clarke who is struggling to turn around the British-based
Announcing his decision just days before results that are
expected to show another decline in profits, McIlwee said he
would quit the board and resign after five years as CFO but stay
on long enough to hand over to a successor.
"The board is commencing a process to find a new chief
financial officer with both internal and external applicants
being considered," Tesco said in a statement.
Shares in the group were down 1.5 percent at 286 pence at
1515 GMT, their lowest level in more than five years.
McIlwee became CFO in January 2009 and had been with the
retailer since 2000. He had been the only other executive
director on the board alongside Chief Executive Clarke.
"After 14 years at Tesco I feel that now is the right time
for me to pursue new opportunities," McIlwee said.
Speculation over McIlwee's position had been surfacing for
months. In October he became the focus of investor disquiet
after Tesco shocked investors by reporting a collapse in profits
at its central European unit, which he had failed to signal.
Sources familiar with the situation had previously told
Reuters that some investors were not happy with the way McIlwee
interacted with them, and that his position was under threat.
Media reports said he had also clashed with Clarke over some
areas of strategy. Clarke himself raised eyebrows last month
when he said at an industry conference that his tenure as CEO
might only be "for a few years".
Having dominated the British high street for years, the
95-year-old Tesco stunned the industry in 2012 when it issued
its first profit warning in 20 years and has struggled since
In common with Britain's three other leading grocers -
Wal-Mart's Asda, Sainsbury's and Morrisons
- Tesco is losing market share as it is being squeezed
between hard discounters Aldi and Lidl
and upmarket grocers Waitrose and Marks & Spencer
It is expected to post another decline in profit when it
publishes 2013-14 results on April 16.
"It is perhaps more than a little unfair that Tesco's Laurie
McIlwee is to be the scapegoat for Tesco's profit weakness, but
his communications skills seem to have left him vulnerable,"
retail analyst Nick Bubb said.
According to consensus forecasts published on Tesco's
website, analysts expect Tesco to post a group trading profit of
3.24 billion pounds for 2013-14, down from 3.45 billion pounds
in 2012-13, its second straight year of decline.
(Editing by Susan Fenton)