Bloomberg News

Metro CEO Selection May Be Delayed as Board Close to Deadlock

November 16, 2011

Nov. 16 (Bloomberg) -- Metro AG, Germany’s biggest retailer, may delay its appointment of a chief executive officer as two candidates vie for the top job, according to a person with knowledge of the matter.

Metro’s supervisory board will discuss a successor to Chief Executive Officer Eckhard Cordes at a meeting on Nov. 18, the person said, declining to be identified as the talks are private. The supervisory board may delay a decision until December if the board is deadlocked between executive Joel Saveuse and Chief Financial Officer Olaf Koch, the person said.

“Some investors think Koch would be a better choice for the CEO position because he has a very strong financial background but other investors think Saveuse would be a better option because he has a strong operational knowledge,” said Sebastian Frericks, an analyst at Bankhaus Metzler in Frankfurt. “This operational background is viewed as very important by some investors in a context of economic recession.”

A tight board vote is probable because the 10 members with links to Franz Haniel & Cie. GmbH, Metro’s majority shareholder, are likely to support Koch, whereas the 10 employee representatives are backing Saveuse, the person said.

Metro appointed French-born Saveuse, 58, as head of its Cash & Carry unit in Europe, the Middle East and northern Africa in April 2010. Saveuse is also chief executive officer of Metro’s Real Group unit. He was an executive at Carrefour SA, the world’s second-largest retailer, between 1997 and 2005, according to his resume.

Kaufhof Sale

Koch, a 41-year-old German, joined Metro as finance chief in October 2009 from private-equity firm Permira Advisers LLP. He started his career as manager at Daimler Benz AG in 1994, according to his resume. Koch is also responsible for Metro’s Kaufhof unit on the board since October 2010, according to his resume. Metro is in talks to sell the department-store chain.

Metro shares have dropped 34 percent this year, the third- worst performance in the Stoxx 600 Retail Index of 24 companies.

Cordes, who was named CEO in 2007, said in October that he wouldn’t extend his contract beyond next year following media speculation that he had lost the backing of some supervisory board members.

Franz Markus Haniel will lead the supervisory board meeting on Nov. 18 after Juergen Kluge stepped down as chairman in October.

--Editor: Sara Marley, Heather Harris

To contact the reporter on this story: Julie Cruz in Frankfurt at jcruz6@bloomberg.net

To contact the editor responsible for this story: Celeste Perri at cperri@bloomberg.net


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