Morrisons rebuffed by Archie Norman in quest for non-execs

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The Independent Online

Archie Norman, the highly regarded retailer credited with turning round Asda in the 1990s, has knocked back an approach by Wm Morrison.

Archie Norman, the highly regarded retailer credited with turning round Asda in the 1990s, has knocked back an approach by Wm Morrison.

The supermarket, which issued its fifth profit warning last week, is under intense pressure from investors to appoint more non-executive directors. Currently it has just one, its deputy chairman, David Jones. He is struggling to find people to fill the roles, and has been further hampered by executive chairman, Sir Ken Morrison, with the two men understood to be at odds about suitable candidates.

Mr Norman, a former Tory MP, is understood to have turned down the approach because he is looking to take a stake in another company. Others are also thought to have opted against working with it. Kevin Lomax, the senior independent director at Marks & Spencer, is believed to have been another possibility but sources say he is not interested.

In addition, a retail insider claims two non-executives were due to be announced at the annual general meeting last month but pulled out at the last minute. One was understood to be Helen Weir, the finance director of Lloyds TSB.

"They have got a real problem," said the insider. "Frankly, how can a non-executive sign up for a company that doesn't know how much money it's going to make?"

Since acquiring rival Safeway last March in a £3bn deal, Morrisons has struggled to integrate the chain, causing sales to dip. It recently admitted it was still running double costs.

In May it revealed it could no longer give any guidance on full-year profits and that it had brought in accountants KPMG. Then last week it issued a "clarification" statement, saying full-year profits were likely to come in between £50m and £150m. Analysts had been looking for up to £275m.

Mr Jones said two weeks ago he was confident he would announce four non-executive directors within "weeks rather than months". A Morrisons spokesman said he was still on track to announce the first one.

Mr Jones also said that once the non-executives were appointed, he would start looking for a chief executive to replace Bob Stott. He is due to step down in 2007, but pressure is building to replace him sooner.

Tim Sawyer, the chief executive of corporate governance body Rrev, said: "They [the non-executives] have got to do two things. The first is say 'tell us what is happening with the numbers, tell us exactly so we can then tell the City'. Then they have to ask, 'who are the right people to take this forward?' "

It is thought that the search is already on for a replacement for Mr Stott, but most expect Mr Jones - who is also chairman of Next - to struggle here as well.

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