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Wednesday 8th February 2012

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You are here: Home | News | Retail round up - The Sunday papers

Retail round up - The Sunday papers

Royal bonus for Sainsbury's King, Boots boss splits jobs, Whelan in talks for a slice of Slazenger, DSG rights issue plan, Credit insurer faces £1m action for failing to pay out on Woolies,

The Sunday Times

Sainsbury's chief executive Justin King is on track to bag a £6m payout after delivering the best sales growth at the supermarket for five years. King's final payout is still being finalised by the chain's remuneration committee, but it is expected to include £4m in bonuses and shares, comprising an annual bonus payment of more than £1m, £585,000 in shares from a long-term incentive plan and about £2.5m in

shares from the second phase of a bonus plan focused on his “Making Sainsbury's Great Again” strategy. His total package would top £6m once his salary, pension and benefits package are included, if the maximum bonus package is approved. The group's performance should also mean a higher bonus for Sainsbury's 117,000 staff — who split a payment of £47m last year. The supermarket's fourth-quarter sales — the three months to March 21 — rose 6.2%, smashing City expectations and analysts now expect full-year profits to be about £540m — £15m higher than earlier forecast.

Stefano Pessina is planning to split his combined role of chairman and chief executive. It is understood that Pessina wants to hire a senior director to take on the day-to-day running of the company while he focuses on strategy, growth and development. Pessina, 67, would remain executive chairman and has no intention of scaling back his role. Sources familiar with the company stressed that the plans remained at an early stage and there was no formal process yet under way. The move comes two years after the former FTSE 100 company was taken private in an £11 billion deal backed by the private-equity firm KKR. The group has started beefing up its board. Alex Gourlay, managing director of Boots UK, has recently joined the board of the parent company.

Dave Whelan is in talks to buy a helicopter and the rights to the Slazenger golf brand from embattled sports retailer JJB Sports for around £10m. The move comes just weeks after Whelan - who founded JJB - agreed a deal to buy the retailer's gym-club chain for £83.4m. JJB declined to comment but said it had previously announced a plan to dispose of some non-core assets. The talks emerge as creditors and shareholders in JJB prepare to vote this week on a crucial restructuring to secure the future of the retailer.

DSG International is edging closer to a rights issue which could raise £200m to £300m. It is thought no formal decision has been taken, but City sources said DSG's banking advisers could start sounding out investors this week. The cash would fund a roll-out of DSG's new megastores and give it the firepower to compete with US giant Bestbuy, which is gearing up to expand in Britain.

The Independent On Sunday

Euler Hermes is facing a legal battle with clients over the collapse of Woolworths. It is believed that a private-equity backed supplier to Woolworths, which collapsed last year, has instigated legal proceedings against Euler Hermes after the insurer refused to pay out on a claim related to the failed retailer. The claim is thought to be for more than a £1m. A source said: "Credit insurance already has a terrible reputation for disappearing when it's needed most. The fact that Euler is not paying out on a perfectly valid claim tarnishes its reputation even further." Reports have suggested that Euler has already lost as much as £50m paying out to policyholders following the collapse of the high-street store. A spokesman for Euler Hermes declined to comment.

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