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Marks & Spencer preparing for CEO Steve Rowe to step down in 18 months

Lauretta Roberts
22 November 2021

Marks & Spencer is said to be gearing up for CEO Steve Rowe to step down in around 18 months; the latest news comes after it was reported that US private equity house Apollo had taken a look at the high street chain with a view to a potential takeover.

According to The Times, Rowe, who became CEO in 2016, believes that the position should carry a tenure of between five and eight years although there is no pressure on him to stand down.

M&S has upgraded its profit forecast twice this year and the turnaround of its clothing arm appears to be underway. Shares in M&S started the year at around 131p and are now trading at around 247p (though this is still below the level when Rowe took over the business).

In the six months to 2 October, M&S recorded pre-tax profits of £269.4 million, versus a loss of £17.4 million a year earlier at the height of the pandemic, and up 52.8% on two years ago before COVID-19 struck.

The group said it expected full-year underlying profits to beat expectations, now guiding for around £500 million – having already upgraded its guidance in late August to above £350 million.

During the period, full-price clothing & home sales were up 17.3% but, like many in the sector, it warned of rising costs and disruption due to the global supply chain crisis.

Rowe is an M&S "lifer" having joined the business as a Saturday worker at the age of 15; he is now 54. It is understood that chairman Archie Norman is keen to have a succession plan in place, should Rowe decide to stand down with co-chief operating officers Katie Bickerstaffe and Stuart Machin said to be contenders, along with CFO Eoin Tonge.

At the weekend The Sunday Times revealed that Apollo had run the rule over M&S, having lost out in the race to acquired ASDA, which was acquired by Mohsin and Zuber Issa, the billionaire brothers who made their fortunes in the petrol forecourt business. Apollo was said to be keen to put its due diligence into the UK supermarket business to good use, though it is not expected to make any announcement about its potential interest in M&S with some suggesting that private equity investors would not be keen to invest in complex turnarounds.

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