Tesco chief executive Sir Terry Leahy is to step down next March after 14 years leading Britain's biggest supermarket, it was announced today.
Sir Terry is to be succeeded in the top job by international and IT director Philip Clarke, who has worked at Tesco throughout his career, having first started as a part-time assistant in 1974.
The chain's outgoing boss, who will be 55 when he retires in March 2011, said he joined the group with a plan to make Tesco number one in the UK and to build long-term growth by expanding into non-food and internationally.
He added: "I feel my work is almost complete."
Sir Terry said he would concentrate on "private investment" after he left Tesco, but would retain a large shareholding in the firm.
He said: "When I became chief executive I had a plan to build Tesco around its customers, to make it number one in the UK and to find new long-term growth in non-food, in services and in international expansion.
"I wanted to develop a purpose and values that could sustain Tesco through its challenges and encourage and grow future leaders.
"It has taken 14 years but that strategy has become a firm reality now and so I feel my work is almost complete."
But shares in the supermarket dropped nearly 2% after news of Sir Terry's departure.
The appointment of Mr Clarke, 50, comes as part of a long-term succession plan put in place by the firm, with a raft of other board changes also announced today.
Tesco named Tim Mason, head of its Fresh & Easy business in the US, as deputy chief executive, based in America.
Commercial director Richard Brasher will take on the newly-created role of chief executive of the UK business, with responsibility also for Irish operations.
And Tesco has hired its first chief executive of Asia, appointing UK retail and logistics director David Potts to the role.
Sir Terry said he would be looking at investing in "business generally" when he retires, but refused to be drawn further on plans for life after Tesco.
He has been with the group since 1979 and held a number of marketing and commercial positions before taking over as chief executive in 1997.
His successor's career path with the firm has been similar, having also worked his way up the ranks.
Mr Clarke started at Tesco in a part-time job while he was at school in Liverpool and later joined the management training scheme after leaving university.
Sir Terry said he was leaving the group in good hands and at an apt time for the business.
"We're coming out of a difficult recession, which I've steered the business through.
"By March 2011, we'll be into a strong recovery and that's a good time for the new team to take over."
But the timing of his departure came as a surprise to the market, with questions over his decision to leave before the fledgling US business has fully bedded in.
Charles Stanley analyst Sam Hart said: "I'd anticipated he would continue for quite a bit longer and would stay until he proved the expansion into the US had been a success."
He added that, despite his many years at the group, Mr Clarke was not a well-known name yet in the wider retail industry.
"But he's almost a mirror image of Sir Terry and most will give him the benefit of the doubt."
Tesco said Mr Clarke has broad experience within the group and was already in charge of almost 2,000 stores and nearly two-thirds of group space.
He joined the board 12 years ago, heading up the supply chain operation, and assumed responsibility for IT a year later.
In January 2004, he took charge of international operations in addition to his IT role.
"He has been at the heart of all our new moves and operational improvements across Asia and Europe in recent years, including China, India and Turkey, building teams and developing talent in these important markets," said Tesco.
Mr Clarke also has experience with other retailers, including as non-executive director at Premier Inn owner Whitbread.
He said: "I am honoured and delighted to succeed Terry, who has taught me so much.
"I am very excited by the opportunity to lead such a fantastic team of executives, many of whom I've worked with for years.
"Together we will build a global business which focuses on the customer and fully respects our people, our communities, our supply chain and our shareholders."
Mr Clarke is married with two children and lives in Hertfordshire.Reuse content