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Friday 10th February 2012

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Retail round up - the Sunday papers

Debenhams mulls over expansion plans, Tesco's commercial director leaves for Somerfield, Next chief executive to advise the Tories.

Mail on Sunday

Debenhams, which could be set for a return to the stock market with a flotation valuing it at more than £3 billion, is considering stepping up ambitious expansion plans. The department store chain last week invited four banks to canvass investors to see if there is an appetite for a float. Now, if the plans go ahead, it could be set to double its size. According to a company source, chief executive Rob Templeman believes the main chain has the potential to be twice its current size of 120 stores, and the new 'Desire' format - a smaller store aimed at women - has also been earmarked for up to 130 market towns.

Tesco's commercial director, Colin Smith, has jumped ship after 20 years to join the new

team at rival Somerfield, the fifth-biggest supermarket group. Smith returned to Britain recently after spending a year in America heading a team of 65 Tesco excecutives weighing up acquisition opportunities there. He has since been based at Tesco's haed office in Cheshunt, after the market leader distanced itself from any ambitions across the Atlantic. Somerfield has 1,400 stores, including the Kwik Save chain and 140 petrol stations, but has struggled in the hugely competitive grocery sector with only a 5.6 per cent share of the market. Somerfield said that Smith would be joining next month.

High street spending could slump as turmoil in the market for British Government securities scare shoppers into 'panic saving'. Sinking returns for investors in Government bonds - gilts - mean millions will need to build up a bigger retirement nest-egg. As gilts, the backbone of the private pensions system, pay out less, more will have to be bought to provide pensioners with the same standard of living in retirement. This, Im turn, means household budgets will have to be cut, threatening retail spending. David Kearn, economic adviser to the British Chambers of Commerce, said, “When the penny drops and people realise they should save more, there will be a potential crisis. It will affect consumer spending and business investment. Companies have a statutory obligation to keep their pension funds topped up and will have to put aside more money”

Monsoon has admitted

that it overstocked and was left with too many lines going into the sales, but boss Rose Foster is still in the running for a top award. Foster is among the stock market's lesser stars who will be celebrated this week when the bosses of small cap companies battle it out for the title of Chief Executive of the Year in the Quoted Company Awards.

The prospect of another cut in the base rate is likely to fade this week with the publication of figures expected to show the start of a recovery in UK growth. While the economy seemed to be in the doldrums, there was a chance the Bank of England might cut borrowing costs from 4.5 per cent to 4.25 per cent. Tomorrow, the independent Item Club, which uses the Treasury's own computer model for the economy, will forecast a sharp upswing in growth, from 1.7 per cent last year to 2.3 per cent this year.

The Independent on Sunday

The chief executive of the Next clothing chain and one of the City's youngest bosses has been appointed by David Cameron

to advise him on how to improve economic competitiveness and wealth creation in the UK. Simon Wolfson is the son of Lord Wolfson, former chief of staff to Margaret Thatcher. His appointment as joint head of the Conservative party's official advisory group on economics will be announced tomorrow. Working with the anti-red tape Tory MP John Redwood, he will jointly chair the advisory group that will seek to reduce regulation and improve educational standards, skills in the workplace and competitiveness. It will also examine Britain's transport infrastructure.

Sunday Telegraph

QS, the Brighton-based discount fashion retailer which also owns the Be-Wise chain, has put 50 stores on the market as it becomes the latest victim of tough trading conditions. Details of a large portfolio of stores were sent to a select group of interested rival store groups last week by Hamsard 2353, QS's parent company. According to reports filed at Companies House at the end of December, the group reported apre-tax loss of £4.9 million for the year to January 29, 2005, down from a profit of £2.1 million the previous year. The company has around 350 stores.

J Sainsbury has agreed a multi-million pound deal to pay backdated pensions contributions to former part-time staff. Anyone who worked for the retailer part-time between 1976 and 1989 will be eligible for retrospective payments into their pension pot if they agree to make their own backdated personal contributions. Before 1989 the company's pension scheme was only open to full-time employees. Six hundred former staff have already applied, and the supermarket is prepared for 4,500 claims.

The Sunday Times

John Hargreaves, chairman and majority owner of Matalan, is to meet shareholders amid growing concern about his dominance of the company.

Disquiet about a management vacuum at Matalan has increased since the announcement last week that John King, chief executive, is to leave at the end of the year. Merrill Lynch, the company's broker, has contacted leading shareholders and offered them a meeting with Hargreaves and Geoff Brady, the deputy chairman of Matalan and senior non-executive.Hargreaves and Brady are keen to explain to shareholders the circumstances surrounding King's departure. He will receive a £420,000 payoff when he leaves, a payment the non-executives argue is needed to ensure that King stays for the full year to allow a smooth handover.

Tagged as: debenhams | tesco | commerce | monsoon.base rate | next | QS | sainsbury | matalan

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