By Saabira Chaudhuri
TescoPLC has named John Allan as its new chairman, replacing
Richard Broadbent.
In an announcement after U.K. markets closed Tuesday, the
world's second-largest retailer by revenue said Mr. Allan's
appointment would be effective March 1.
Mr. Allan is the former chairman of electronics retailer Dixons,
which recently merged with Carphone Warehouse to become Dixons
Carphone PLC. He became deputy chairman of the combined company,
though Dixons Carphone said Tuesday that he would step down
immediately. Mr. Broadbent, a former deputy chairman of Barclays
PLC, has been Tesco chairman since 2011.
Tesco has been on the hunt for a new chairman since October,
when it revealed that the accounting practices that led to a GBP263
million ($404 million) overstatement of its first-half profit had
also occurred in prior periods. It named Dave Lewis as its new
chief executive in September, replacing Philip Clarke.
Many in the investment community had expected retail-industry
veteran Archie Norman to be named chairman. Mr. Norman was chief
executive and chairman of the U.K.'s Asda supermarket chain before
Wal-Mart Stores Inc., the No. 1 global retailer, bought it in
1999.
Mr. Norman is now chairman of the U.K. television company ITV
PLC. An ITV spokesman didn't immediately respond to a request for
comment.
"There may be some disappointment after recent speculation
linked Archie Norman, of Asda turnaround fame, to the role of
chairman of Tesco," said John Kershaw, an analyst at Exane BNP
Paribas. Still, he noted that Mr. Allan's experience at Dixons
along with a deep knowledge of global logistics "should provide
valuable insights to a Tesco business undergoing marked
change."
Mr. Allan will join Tesco at a turbulent time for the company.
The U.K. supermarket giant's governance has been under intense
scrutiny after it called in outside auditors to investigate the
misstatement of its accounts.
"Following a deep and thorough process run by a committee of
independent nonexecutive directors, the board unanimously agreed
that John Allan was the right candidate to chair Tesco at this
important time," said Tesco's senior independent director, Patrick
Cescau, in a statement.
Tesco has struggled through a tough period lately, with the
accounting scandal adding to woes being experienced by the whole
British supermarket sector in the face of vicious price wars that
have squeezed profits. Tesco, like its peers, has been battling
competition from both higher-end grocery stores and aggressive
discounters.
Tesco is being investigated by U.K. retail regulator the
Groceries Code Adjudicator, which earlier this month said it
suspects that the company breached the industry's code of conduct.
The retailer also is the subject of an investigation by the U.K.
Serious Fraud Office into its accounting, which could result in
criminal charges for individuals, or the company as a whole, as
well as by the Financial Reporting Council. Tesco has said it is
cooperating fully with all of the inquiries.
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
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