M&S Rejects Latest Green Bid; Top Marketer Quits

17 June 2004

[See Stop Press below for latest bid news]

Another executive bites the dust at Britain's largest high-street retailer, Marks & Spencer. Despite M&S' vehement denial that the recruitment earlier this month of consultant Steven Sharp would affect the marketing department line-up [03-Jun-04], marketing director Alice Avis is the latest figure to fall from favour.

Leaving with a £250,000 ($456,400; €378,600) pay-off, Avis follows swiftly in the footsteps of Vittorio Radice, who left last week after a "mutual decision".

New ceo Stuart Rose has been visiting stores, speaking to customers, management teams and suppliers and gathering information for his forthcoming strategy update.

This will be presented on July 12, just two days before the annual meeting and will detail plans for shaking off the company's old-fashioned image.

Although no particulars have been confirmed, Rose is apparently "comfortable that he can deliver a plan for shareholders within one month. He is addressing the fundamentals of the business rather than looking for easy, short-term ways of creating value."

Analysts expect a reduction in Simply Food stores and a return to the traditional mixed clothing/food store, an end to the homeware and lifestyle store Lifestore, as well as the axing of the Per Una Dué clothing range aimed at the youth market.

No specific financial announcements by M&S are expected on July 12, perhaps keeping its powder dry for further developments in the expected hostile takeover bid by entrepreneur Philip Green.

STOP PRESS: 09.00 GMT Thursday 17-Jun-04
M&S Board Rejects Green's Increased Bid

It took the board of British high street retail titan Marks & Spencer just one and a half hours to dismiss the latest hostile takeover offer from colourful Monaco tax exile Philip Green.

Although worth around £8.3 billion ($15.16bn; €12.62bn), the all-cash offer of £3.70 a share "significantly undervalues the group and its prospects," opined new M&S chairman Paul Myners. Word is that major shareholders are unlikely to sit up and take notice unless Green's offer exceeds £4 per share.

At 4pm Wednesday Green presented himself in person at M&S' Baker Street headquarters, ostensibly to deliver his revised offer -- but primarily to take advantage of a carefully orchestrated photo-opportunity. He was 'greeted' by Myners and the retailer's new chief executive Stuart Rose.

By 5.30pm the M&S board had convened in its entirety, together with its legion of advisers, and an announcement was agreed by 7pm. At 7.15pm the director with the shortest straw called the famously expletive-prone Green to break the news.

Data sourced from: Financial Times and BBC Online Business News (UK); additional content by WARC staff