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Wm Morrisons chief executive David Potts is standing down after nine years at the helm of one of the UK’s largest supermarket chains.
He will be replaced next month by Rami Baitiéh, previously the chief executive of Carrefour France.
Potts, who presided over Clayton, Dubilier & Rice’s highly leveraged £7bn acquisition of Morrisons, said running the grocer had been the “privilege of a lifetime”. He added that he had several conversations with Sir Terry Leahy, Morrisons’ chair and senior adviser to CD&R, about succession planning since the buyout in 2021.
“We had a clear understanding that I was prepared to devote several more years to Morrisons if that was required, but that if an outstanding successor was identified who could lead Morrisons for the long term, then I would step down,” he said.
Leahy said it was a “bittersweet farewell for me because I have known and worked with David for decades, but I will be happy to see the start of his next adventure”.
Potts insisted the CD&R deal was good for Morrisons in the long term despite its £6.6bn debt burden. He said the grocer’s previous shareholders did well out of it, with a price at a 60 per cent premium. “I do believe working with CD&R we’ve learnt to value cash, make sure all our costs are going on things that are truly valued by customers,” he said.
Leahy lauded Baitiéh, who joined Carrefour in 1995 and climbed the ranks to become chief executive of the chain in France in 2020, leading 150,000 employees across 5,800 stores. He was an “exceptionally talented and highly capable leader”, Leahy added.
Baitiéh was sent to turn around struggling country operations in Taiwan, Argentina and Spain, the retailer’s third biggest market.
Following those successes, he ran Carrefour in France as part of group chief executive Alexandre Bompard’s plan to improve the company’s sales in its core market, which accounts for nearly half of group sales but where Carrefour had been losing market share.
Performance in France had been improving, but Carrefour announced Baitiéh was leaving at the end of August after almost three decades “to devote himself to a new professional project abroad”.
Under Potts, who began his career on Tesco’s delicatessen counter earning £10.50 a week, Morrisons underwent a revival of its brand while it was listed on the London stock market. He also steered the retailer through the Covid-19 pandemic.
More recently, however, Morrisons has been losing market share to rivals during the cost of living squeeze as it struggles to keep prices as low as some competitors. German discounter Aldi last year overtook Morrisons to become the UK’s fourth-largest supermarket.
Potts said he would go on a short break with his family and would then look for further ways to contribute to business and to the UK’s economic recovery from the pandemic. He said he would not rule out another high-profile role. “I’m only retiring from Morrisons, but not from commerce and not from life.”
He said he felt “very relaxed and happy” about his departure after in June he indicated in an interview with the Times that he expected to stay on for some time.
Clive Black, at Shore Capital, said Potts, a keen Manchester City supporter, was “Champions League material when it comes to the British grocery scene” and he “undertook a remarkable textbook turnaround exercise at Morrisons”.
The news came as Morrisons posted a 3 per cent increase in like-for-like sales, excluding fuel, driven by revenue in the third quarter. It is the fifth consecutive quarter when sales have improved, but it still lags behind many UK competitors.
Potts defended Morrisons’ lacklustre sales and said that “in the end we’re going to end up in a good spot” as more competitive prices were leading to positive volume growth.
