Unilever Exec Takes Reins of Struggling Tesco

Tesco CEO Philip Clarke will step down on Oct. 1, following the U.K. grocer's poor sales performance during the first half of this year.

Dave Lewis, head of London-based Unilever's personal care business, will take the reins after the departure of Clarke, who has guided the grocer through a series of struggles since his appointment in 2011.

Following the sale of Tesco's struggling Fresh & Easy banner to The Yucaipa Cos. in November 2013, as well as continued competition from discounters Aldi and Lidl, Tesco last month posted its worst sales decline in 20 years.

The grocer noted its sales and trading profit would be "somewhat below expectation," which it attributed to challenging conditions, a weaker market, and increasing investments to improve the customer offer and build long-term loyalty.

The appointment of Lewis, according to the company, is designed to bring a "new leader with fresh perspectives and a new profile."

Tesco Chairman Sir Richard Broadbent noted that Lewis will bring a wealth of international consumer experience and expertise in change management, business strategy, brand management and customer development to his new role.

Lewis brings 28 years' experience and leadership to Tesco, having spearheaded a number of business turnarounds with Unilever. 

“A change in leadership may bring some much-needed fresh thinking to Tesco, but the structural shifts in the grocery sector cannot be reversed," Natalie Berg, global research director at Planet Retail, said in an e-mail. "Lewis will need to reposition Tesco to adapt to this new normal." 

Clarke will also step down as board member in October, but will assume a support role during the transition period, which is expected to last through January 2015.