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Wm Morrisons chief executive David Potts has resigned after nine years at the helm of one of the UK’s largest supermarket chains.
He will be replaced next month by Rami Baitiéh, France’s Love chief executive.
Potts, who presided over Clayton, Dubilier & Rice’s highly leveraged £7bn takeover of Morrisons, said running the grocer was “the privilege of a lifetime”. He added that he had had a number of conversations about succession planning with Sir Terry Leahy, chairman of Morrisons and senior adviser to CD&R, since the 2021 acquisition.
“We have a clear understanding that I am prepared to devote a few more years to Morrison if required, but if a great successor is found who can lead Morrison in the long term, then I will step down,” he said.
Leahy said this “is a bittersweet farewell for me as I have known and worked with David for decades, but I am excited to see the beginning of his next adventure”.
Potts insists the CD&R deal will benefit Morrisons in the long term, despite its debt burden of £6.6bn. He said that the former shareholders of the grocery store profited greatly from it, and the purchase price was a 60% premium. “I do believe that working with CD&R, we’ve learned to value cash and make sure that all of our costs are spent on things that our customers really value,” he said.
Leahy praised Baitiéh, who joined Carrefour in 1995 and was promoted to CEO of the chain’s France in 2020, leading 150,000 employees in 5,800 stores. Leahy added that he was a “talented and highly capable leader.”
Baitiéh was tasked with turning around struggling national operations in Taiwan, Argentina and Spain, the retailer’s third-largest market.
Following those successes, he runs Carrefour in France as part of group chief executive Alexandre Bompard’s plan to boost sales in the company’s core market, which accounts for nearly half of group sales but where Carrefour has been losing market share.
Performance in France had been improving, but Carrefour announced that Baitiéh was leaving at the end of August after nearly three decades at the company “to work on new professional projects abroad.”
Potts started his career on the Tesco deli counter, earning £10.50 a week. Morrisons experienced a brand renaissance during its listing on the London Stock Exchange. He also steered the retailer through the Covid-19 pandemic.
Recently, however, Morrisons has been losing market share to rivals as it struggles to keep prices as low as some of its rivals due to the cost-of-living squeeze. German discounter Aldi overtook Morrisons last year to become the UK’s fourth largest supermarket.
Potts said he would take a short break with his family before looking for further ways to contribute to business and the UK’s economic recovery from the epidemic. He said he wouldn’t rule out taking on another high-profile role. “I’m just retiring from Morrisons, but not from business and not from life.”
He said he was “very relieved and happy” to be leaving, and in June he told The Times in an interview that he expected to stay on for some time.
Shore Capital’s Clive Black said Potts, a keen Manchester City supporter, was “Champions League material for the UK grocery industry” and that he had “put on a remarkable, textbook run at Morrisons” ‘s transformation”.
The news came as Morrisons reported annual sales excluding fuel rose 3 per cent, driven by third-quarter revenue. It was the fifth consecutive quarter that sales had improved but still lagged many UK rivals.
Potts defended Morrisons’ sluggish sales and said “ultimately we will be in a good position” because more competitive pricing is leading to positive growth in sales.
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