Hornby exit signals shake-up at WH Smith: First group executive named as company considers changes in two-tier share structure

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The Independent Online
SIR SIMON Hornby is to retire as executive chairman of WH Smith, a move that has triggered wide-ranging boardroom changes at the retail and distribution group.

He is being replaced by Jeremy Hardie, the deputy chairman, who takes over the newly created role of non-executive chairman. For the first time WH Smith will have a group chief executive, Sir Malcolm Field, currently managing director.

At yesterday's annual meeting the company also hinted that it was considering changes to its two-tier share structure. 'We have from time to time in the past considered proposing such a move for WH Smith and this remains under active consideration,' Sir Simon said.

WH Smith would be following companies like Whitbread and Great Universal Stores, which have enfranchised capital into one class of shares.

Sir Simon, aged 59, will step down on 29 January after the interim results, ending 12 years as chairman. Suggestions that he was forced to move aside were thought to be wide of the mark, with one large institutional shareholder saying it had not pressed for changes.

Although WH Smith's joint-venture DIY chain Do It All has been a disaster, the company has built up a strong market share in growth industries such as books and records. WH Smith is also one of the few UK retailers that trades successfully overseas.

David Roberts will become managing director of distribution and support services, while Peter Troughton will become managing director of UK retailing. Both are seen as candidates for the chief executive's job in about four years when Sir Malcolm is due for retirement.

There had been speculation that WH Smith would look outside the company to fill one of the top posts, and the decision to promote internally was seen as a sign that there would be no big strategic changes at the company.

Mr Troughton will be succeeded as managing director of WH Smith retail by Peter Bamford, who is being rewarded for his success at the American operation, Wee Three Record Shops, where he is chief executive.

Sources at WH Smith said that the two-tier share structure would eventually be changed, though no move was imminent. The 'B' shares account for 36 per cent of the voting rights and 10 per cent of the equity. Most of them are owned by the Smith family and Sir Simon, giving them immense voting power. There has been lobbying by institutional and small shareholders for companies to equalise voting rights.

WH Smith's 'A' shares rose 9p yesterday to 479p, and the 'B' were up 6p to 98p.

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