Sir Ken Morrison is poised to bow to shareholder pressure and cut executive ties with the supermarket chain that bears his family name.
After a sustained campaign by investors, Sir Ken, 74, is tipped to relinquish his executive role, taking a back seat for the first time since Wm Morrison floated on the stock market in 1967.
The announcement of Sir Ken's new role is set to be unveiled today alongside the news that Marc Bolland, the chief operating officer at the Dutch brewer Heineken, is to replace Bob Stott as chief executive.
At the same time, David Jones, the deputy chairman who has been the driving force of boardroom reform since becoming Morrisons' first independent director, will confirm that his job is done and he is stepping down. Mr Jones, who has Parkinson's disease and recently left the board of Next, has been adamant for months that he would quit Morrisons for the quiet life as soon as he had firmed up the company's succession plans.
Sir Ken told shareholders at the company's annual meeting that he would leave the group by January 2008, but declined to comment on the nature of his role once the new chief executive was in place. Investors have been worried that, with Sir Ken still calling the shots, the newcomer would struggle to impose his authority on a business badly in need of a fresh intellectual input after suffering severe problemssince its £3bn takeover of Safeway.
The board's directors, led by Mr Jones, have sounded out institutional investors about Sir Ken's plans and received robust support. One source close to the situation said: "Shareholders are very, very happy this is happening."
The outcome of a battle that has pitched Mr Jones against Sir Ken for the past two years will save face for both sides. Mr Jones' legacy will be a company with legitimate corporate governance for the first time in its history, while Sir Ken will be able to feel he is staying on to oversee what he hopes will be a new lease of life for the enlarged group. In any case, Sir Ken will retain the honorary title of life president, as Lord Kalms did when he left Dixons, now called DSG International.
Morrisons, which issued a string of profits warnings that culminated in the admission that it had no grip on its finances at all, showed signs of life in its latest trading update that revealed underlying sales excluding fuel had increased by 3.7 per cent in the most recent trading period.
Industry figures from TNS Superpanel, the market research group, last week showed that Morrisons had grown its market share for the first time since taking over Safeway.Reuse content