Per Una's Davies quits M&S
Fashion guru George Davies today dramatically quit retailer Marks & Spencer after talks over a contract extension broke down.
Mr Davies will step down in 12 months’ time as consultant to the Per Una business he created to revive the fortunes of the ailing high street icon.
News of his departure and two key colleagues from Per Una took the gloss off the first positive sales update from M&S for two years and a major milestone for its shares.
But it caused little surprise in the City as a string of media reports in recent days suggested contract negotiations between Mr Davies and M&S boss Stuart Rose were in danger of falling apart.
The stumbling block is thought to have been salary and Mr Rose commented in interviews this morning that “no relationship could continue at any price”.
An M&S spokesman said later: “We were exploring ways for George to continue to work with us, but found it impossible to come to an agreement.”
M&S revealed that Andrea White and Melanie Davies, finance director and head of merchandising at Per Una respectively, were also leaving.
Today’s update showing positive sales momentum will help reassure investors that M&S can continue to recover without the input of Mr Davies.
Per Una accounts for only £350m of sales a year compared to £8bn for the whole M&S retail empire.
However, Seymour Pierce analyst Rhys Williams said: “It’s a massive blow for M&S as we’ve been hearing that Per Una is one of its better sales areas in clothing. It’s probably seeing high-teen sales growth at present.
“To lose not just George Davies but the entire top team is regrettable and is likely to have an impact in the near term.”
Retail entrepreneur Mr Davies invented the Per Una womenswear range for M&S in 2001 and kept ownership of the brand so that M&S only had the right to sell it in its stores.
This changed last year when the retailer paid £125.9m for full control of Per Una, as part of its strategy to defeat a £9.1bn takeover attempt by Bhs owner Philip Green.
At the time, M&S said Mr Davies would stay on for at least two years as chief executive of Per Una.
Mr Davies made his name in the 1980s when he created the Next brand, building it up into one of the UK’s top 100 companies, before going on to set up Asda’s George clothing label.
His Per Una range proved a hit with customers despite disappointing clothing sales elsewhere in the business prior to this summer.
