Mixed views on Walden's heir

By DANIEL RIORDAN

Former million-dollar man Nick Lowe will succeed Wayne Walden at the helm of Farmers Deka.

Mr Lowe, whose last stint as a chief executive in New Zealand retail ended with a controversial million-dollar payout from Pacific Retail Group to gild his million-dollar salary, starts his new job next month.

Don Humphreys, chairman of Farmers Deka's parent, Perth-based Foodland Associated, said Mr Lowe was a well-rounded executive who had spent the past three months consulting to the business . He understood what was required.

"The business needs to grow. It has sat on its hands for a time. We need someone to look at the business again. Are our formats right? Are our store sizes right?"

Mr Humphreys said he understood the circumstances of Mr Lowe's departure from PRG "as they were outlined to me" and he was not concerned.

Mr Lowe left Pacific Retail last June after failing to reach agreement with the board on his pay.

His departure came a year after Pacific Retail head-hunted him from Britain's largest appliance re-tailer, Dixons Stores.

He earned a salary package worth $1.1 million and negotiated a severance package of $975,000, including a restraint of trade payment of $200,000.

Under Mr Lowe's reign, Pacific Retail managed to improve sales, although profits dipped.

The market had been expecting Mr Walden to leave, but the announcement of Mr Lowe as his successor met a mixed reaction.

One analyst saw his appointment as a positive move, citing his experience and his obvious insight into the opposition.

But another analyst questioned his track record at Pacific Retail and said he faced a big challenge at Farmers Deka turning around some mediocre financial performances in the face of recent losses of key staff.

The company last week revealed that poor sales of big-ticket items from its 125 stores had helped to drag down its performance for the year to the end of July.

While clothing sales increased 7 per cent, furniture and appliances did not sell well, particularly in the second half.

Farmers has big expansion plans, striking a recent deal with shopping mall owner Westfield to take anchor tenancies in four of its mall projects, but the Deka chain is very much the poor relation.

Mr Walden, aged 52, ran Farmers Deka for seven years.

He said he told the board last November that he intended to resign as managing director. He plans to pursue outside interests which include his farm north of Auckland and membership of the Meat Board.

He will consult for the company until the end of the year.