Tesco counts cost of Leahy’s surprise exit
A TOTAL of £778m was wiped off the value of Tesco yesterday after chief executive Sir Terry Leahy announced plans to step down early.
The dour Scouser, who has been widely credited with transforming the business from a UK-focused grocer into a giant of the international stage, will retire in March 2011 after 14 years at the helm.
The head of Tesco’s international division, Phil Clarke, 50, was anointed Leahy’s successor and there will now be a handover period lasting nine months.
Tesco’s shares fell 9.70p to 397.4p as Leahy said: ‘There is no better job but it’s important as a chief executive to know when to go and that’s when it’s your choice and from a position of strength.’
He said that when he took on the job, he had a plan: ‘To become number one in the UK and then to seek long-term growth opportunities in services, non-food and international.
‘But most important of all I wanted to develop a purpose for the business and encourage young people to come forward as future leaders. I feel my work is largely complete.’
Leahy, 54, said he plans to spend time on working on his private investments and has no plans to join other company boards or enter politics.
Chairman David Reid said: ‘The departure of a leader of the calibre of Terry will of course be a loss. But he has steered it through the recession.’
The appointment of Clarke, described as a real ‘people person,’ marks the importance of the overseas businesses to Tesco’s future growth.