Next’s chief executive Simon Wolfson is joining the board of Deliveroo, the food delivery service gearing up for a multibillion-pound float, in his first external directorship during his three decades at the retailer.
Lord Wolfson is the longest-serving chief executive in the FTSE 100, having been in charge of the high street fashion chain since 2001. He is widely praised for his attention to detail and strategic acumen in developing a strong ecommerce business alongside the traditional store estate.
Deliveroo, which had been heavily lossmaking in 2019, has been a beneficiary of the coronavirus pandemic. Restaurants forced to close their doors during the UK’s repeated lockdowns have turned to delivery services to offer takeaway services, and the company has also agreed partnerships with retailers such as Waitrose, Marks and Spencer, Wm Morrison, Aldi and Co-op.
Its most recent funding round valued the company at $7bn and it is widely expected to float on the stock market this year.
Fidelity, the US fund management group that was among the lead investors in that round, is also a substantial shareholder in Next and is supportive of Lord Wolfson’s appointment, according to one person briefed on the matter.
Lord Wolfson said he was “delighted” to be taking on the role as a non-executive director.
But investors did not appear to share his enthusiasm; Next shares were almost 3 per cent lower in mid-morning trade on Tuesday while the wider market was flat.
One analyst who follows the company said investors might be concerned about him being distracted at a pivotal time for Next.
The company said, however, the decision was “categorically not the start of a long goodbye”.
“Simon is completely absorbed by what Next is doing at the moment, especially the total platform,” it added, referring to the development of a technology and logistics system that can be marketed to other brands in the way that The Hut Group and Ocado do.
Samuel Johar, chairman of executive search firm Buchanan Harvey, also said it was too soon to start talking about Lord Wolfson heading for the non-executive circuit, despite his long tenure at Next.
“He is still relatively young and the company is performing well. I think this is more about learning, and it also gets him close to Amazon.”
The US ecommerce giant owns 16 per cent of Deliveroo following an earlier funding round and has a seat on the company’s board.
Will Shu, co-founder and chief of Deliveroo, said: “Simon will bring great knowledge and insight to the company and help us in our mission to become the definitive food company.
“We are looking forward to working with him as we continue to innovate, developing new tech tools to support restaurants, to provide riders with more work and to extend choice for customers.”
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