Charles Bowen, who has overseen a dramatic decline in Booker's fortunes in recent years, has already given up all his executive responsibilities and could be in line for a pay-off of more than pounds 600,000 under the terms of his two-year rolling contract. He was paid a salary of pounds 315,000 for the year to 1996, the last year for which details on directors' pay are available.
"The company has under-performed for years and he has paid the price for that," said one analyst. According to Booker's finance director, John Kitson, Mr Bowen was asked to leave by a unanimous decision of the rest of the board after it became clear the group was going to have to announce another profits alert.
Mr Bowen was responsible for the pounds 264m acquisition of rival cash & carry firm Nurdin & Peacock 18 months ago. The integration has been poorly handled and since then Booker has issued four profits warnings. "The erosion of shareholder value has been quite remarkable," said one analyst. Booker shares stood at 470p at one point in 1994. Yesterday they closed 4p lower at 240p.
A strategic review of Booker's operations will now be undertaken by Alan Smith, the Storehouse chairman, who moves up to become deputy chairman. He will report on the review's findings at the annual meeting in June.
Analysts expect it to recommend the sale of all Booker's businesses apart from cash and carry and food distribution. Businesses up for sale could include UK and American agribusiness such as salmon farming, a fish processing business and the prepared foods operation which makes sandwiches and ready-made meals for supermarkets.
Analysts said these interests could fetch a combined total of around pounds 250m which could be returned to shareholders. They expect a cut in the dividend and some say the shares could be worth close to 300p.
The slimming down of Booker follows similar moves by other food groups such as Perkins Foods, Hillsdown Holdings and Dalgety.
Booker blamed its latest profit warning on operational difficulties in the integration of the Nurdin cash and carry business. This will mean the "full financial benefits will now be realised slower than planned".
The strength of sterling has also affected salmon prices and therefore profits. Booker said it expects 1988 profits to be "somewhat below market expectations". Analysts cut their forecasts from as high as pounds 110m to pounds 90m.
Commenting on the company's poor run, chairman Jonathan Taylor said: "1997 has been a difficult year for Booker. The board is now implementing a strategic review to ensure that shareholder value is significantly improved as we go forward."
The full year to December 1997 showed a fall in profits from pounds 92.7m to pounds 76.1m. This was due to a profits shortfall in the fourth quarter at the cash and carry operations. Problems included the failure of a supplier's computer system, the timing of the increase in tobacco duty and unforeseen changes in the sales mix at the former Nurdin branches.