Sainsbury (J) (SBRY) is kicking-off the search for a new chief executive to replace Mike Coupe as it looks to move on from its failed attempt to merge with Asda. The grocer has set the wheels in motion internally for a succession plan, according to two sources. Three internal candidates have been tipped for the top. They are John Rogers, the boss of Argos, Simon Roberts, its retail and operations director who used to run Boots UK, and Paul Mills-Hicks, the food commercial director. Sainsbury’s is due to conduct a thorough external search.
Berkeley Group Holdings (The) (BKG) attempt to placate anger about its sky-high bonuses has run into trouble as an influential City adviser has called for its new pay policy to be voted down. Glass Lewis has told its members that the housebuilder’s decision to do away with an annual bonus while extending the length of its long-term incentive plan (LTIP) could encourage bosses to focus on returning cash to shareholders rather than investing for the future. It also raised concerns that targets for the LTIP, which paid out a combined £23m to seven bosses last year, were not tough enough, and the decision to let shares banked by bosses vest over an extra two years compared with the previous plan. Investors will have a change to block the new policy in a binding vote at Berkeley’s AGM next month. Berkeley has already capped the annual amount bosses can take home at up to £8m following outrage over a combined payout of £92m in 2017. The Investment Association, another adviser, has backed the proposals.
One wealthy backer of Simba, the online mattress seller, couldn’t contain his excitement about the start-up’s prospects in May last year. “I fundamentally believe that Simba will deliver a boatload of cash to all investors,” he said. Simba’s arch rival Eve Sleep PLC (EVE), which offers much the same product, a foam mattress in a box, was dismissed. “Simba s—- all over Eve, who are public,” said the investor. Yet the two companies, launched a year apart, are now in “early stage” talks to merge. Rather than a triumph of one side over the other, the possible tie-up is a defensive move that tells of two sets of disappointed shareholders. The two firms have argued that a deal could improve their buying power and cut costs, a pro-consumer claim relied upon by Asda and Sainsbury’s as they unsuccessfully attempted to convince competition watchdogs to allow their merger. “Merging is the only option to ensure their long-term survival. It’s the first domino to fall in the consolidation of the market as the high marketing costs force many of the smaller brands to merge or fold,” says Matt Walton, a retail analyst at GlobalData. Eve and Simba could face similar scrutiny under current competition rules. “There is significant overlap, with similar features in their hybrid mattresses, trial periods, warranties and delivery. Indeed, the main difference between the two are the physical retailers they partner with and a wider range and price architecture at Eve,” Walton adds. The cost efficiencies might squeeze suppliers as well as hurt some staff, who face the axe if the two brands become one, which is the current plan, according to one insider.
Questor: emerging markets may no longer excite us but they are key to Unilever’s future. Questor share tip: growth rates in India and China still dwarf anything seen in the West and Unilever (ULVR) is nicely positioned to benefit. Buy
