* Tesco says M&S CFO Alan Stewart to join firm in same role
* No start date given for Stewart
* Stewart likely to be held to 6mth notice and non-compete
* M&S shares down 1 pct, Tesco shares up 0.5 pct
(Adds detail, analyst comments, shares)
By James Davey
LONDON, July 10 Marks & Spencer Chief
Finance Officer Alan Stewart has quit to join Tesco in
the same role, jumping ship from one struggling British retailer
Just two days after helping M&S Chief Executive Marc Bolland
present first-quarter sales, Stewart has left Britain's biggest
clothing retailer to join the world's third-biggest stores group
on an increased salary and with a 1.7 million pounds ($2.9
million) golden hello.
His appointment will be a boost to Tesco CEO Philip Clarke,
who is currently the only executive on Tesco's PLC board, and
who is facing questions over whether he has the right strategy
to turn around the 95-year-old group.
"We wanted a candidate who had the right blend of
experience, leadership and values to play a leading role in the
transformation of Tesco. We have found all three in Alan,"
Stewart abruptly left M&S' central London headquarters after
handing in his notice early Thursday, a source familiar with the
situation said. But he was unlikely to start work at Tesco
before the end of this year due to a six-month notice period and
the triggering of a non-compete clause in his contract, the
Shares in M&S were down 1 percent at 1209 GMT, while Tesco's
shares were up 0.5 percent. Tesco's shares are hovering near
10-year lows, while M&S's are down over 40 percent since their
peak in 2007.
Tesco, which has been looking for a new finance chief since
Laurie McIlwee announced his intention to quit in April, said
Stewart would join "following satisfaction of existing
Stewart has held the CFO role at M&S since October 2010 and
had responsibility for property added to his role just 11 days
ago when Bolland shuffled the remits of his executive team.
Stewart is a former finance director of WH Smith
and has also held executive roles at HSBC and Thomas
He leaves Bolland, who is also battling against tough
trading and who was criticised by private shareholders at the
firm's annual investor meeting on Tuesday.
"I can see why he wants to jump ship, given the gloomy
outlook for M&S, and that is a telling blow to the M&S recovery
story," independent retail analyst Nick Bubb said.
"Why he thinks Tesco is a better story is a more interesting
question. And whether he will be any more investor friendly than
his predecessor at Tesco remains to be seen."
Other analysts view Stewart's departure as opportunistic,
and did not regard him as central to the delivery of M&S's
Tony Shiret, retail analyst at Espirito Santo Investment
Bank, said Stewart had operated at M&S in broadly the same way
as when he was at WH Smith - on a lower level than the CEO in
both organisations, rather than as a counter-balance and source
of strategy origination.
"We expect that this will continue at Tesco and see no
reason to adapt our negative stance on that stock following
today's news," he said.
Stewart will see his basic annual salary rise from the
579,000 pounds ($985,200) he was on at M&S to 750,000 pounds at
He will also be granted replacement share awards with a
value of 1.74 million pounds in lieu of his deferred share
awards from M&S that he will forfeit when he joins Tesco.
M&S said Stewart's responsibilities will be carried out on
an interim basis by Paul Friston, a former director of financial
group control who was recently appointed as executive assistant
to Bolland. It said a search for Stewart's successor has
($1 = 0.5877 British Pounds)
(Editing by Kate Holton and Jane Merriman)