Asda chief executive quits amid slowdown

Tony Denunzio has resigned as chief executive of Wal-Mart's Asda chain to join a private equity-backed Dutch retailer as signs emerge of a slowdown in the supermarket group's growth record.

Mr DeNunzio, 44, who joined Asda in 1993 and became chief executive in 2002, intends to invest personally in Royal Vendex, the Dutch non-food retailer he will join on 1 June as chairman.

Vendex was taken over by a private equity consortium, including Kohlberg Kravis Roberts, in July in a £1.7bn deal. It is the biggest non-food retailer in the Netherlands and has operations in Germany, France and Spain. It has 1,700 shops and employs 40,000 people.

Mr DeNunzio did not reveal how much money it had taken to persuade him to swap Asda for Vendex or what size stake he would be buying in the Dutch business.

He is the latest product of an Asda management school that has produced Archie Norman, now a Tory backbencher, Allen Leighton, the chairman of Royal Mail and Richard Baker, the chief executive of Boots. During his time at Asda, Mr DeNunzio has helped it become Britain's second-biggest supermarket chain behind Tesco, overtaking Sainsbury's and building up a reputation for canny retailing. Its George range of value-for-money clothing has grown into a £1bn-a-year business.

New sales data for the 12 weeks to 27 February, published yesterday, shows that while Tesco continues to enjoy strong sales growth, Asda is slowing but J Sainsbury is staging a comeback. Sainsbury's produced 2 per cent year-on-year growth and rebuilt its market share to 16 per cent, up from its low of 15.3 per cent in September.

After exceeding Tesco's pace of growth for most of 2003, Asda has started to slow, going from nearly 10 per cent in January 2004 to 4 per cent.