Sainsbury's prepares for battle

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Sainsbury's announced a boardroom shake-up yesterday designed to boost investor confidence and restore the company's position as the UK's leading supermarket group. The company is looking to adopt a more aggressive trading strategy and take the battle to rivals such as Tesco and Asda, which have overtaken Sainsbury's as the most innovative retailers in the field.

The changes were criticised in the City for not going far enough, as David Sainsbury has stopped short of splitting the roles of chairman and chief executive. He remains executive chairman. Dino Adriano, 52, head of the Homebase DIY chain, emerges as the company's chief executive in waiting. Sainsbury's shares failed to respond to the restructuring, closing 1p lower at 388p.

Tony MacNeary of NatWest Securities described it as "a slow step in the right direction for quite a conservative company."

Another said: "It's a good step but not what the City was looking for. We were hoping for more radical changes than this."

The restructured board will see David Sainsbury remain as executive chairman, with two chief executives running the main operating subsidiaries. Tom Vyner, the influential deputy chairman of the group, will become chief executive of the UK supermarkets division until he retires at the end of next year. He will then hand over to Dino Adriano, who has performed well at Homebase but is thought to lack experience in the UK supermarket sector.

A new chief executive will be sought to run both the US business and Homebase when Mr Adriano moves on. An external candidate is likely.

Mr Sainsbury said he was not disappointed to move away from the day- to-day running of the supermarkets: "Given the scale of the business, it is simply no longer possible to have someone who is both chairman and chief executive. We need a very clear structure."

He added that the new structure, together with the recent appointment of a new marketing director, addressed two of the group's weaknesses.

Mr Adriano said he was looking forward to the task of battling against Tesco, Asda and Safeway. "It's a challenge but I think I'm ready for it."

Commenting on his management style, he said: "I like to take a thoughtful, resolute approach and prefer immediate action. I hate indifference and don't like office politics."

Mr Adriano trained as an accountant before joining Sainsbury's in 1964. He spent the early part of his Sainsbury's career in accounting functions before becoming an area director of the company's supermarket business between 1986 and 1989.

For the last six years he has been running Homebase and is currently overseeing the integration of the Texas Homecare chain, which was acquired last year.