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J Sainsbury PLC

Sainsbury's shares gain on reports of CEO Mike Coupe's replacement

“Every responsible business has potential succession plans for its CEO. This is nothing new,” a Sainsbury’s spokesperson responded

J Sainsbury PLC - chief executive Mike Coupe

J Sainsbury PLC (LON:SBRY) shares were the top risers on Monday on the back of speculation that chief executive Mike Coupe could soon be replaced.  

A trio of senior managers, Paul Mills-Hicks, Simon Roberts and John Rogers, were being considered for the CEO role, it had been reported in the Telegraph over the weekend.

Coupe’s departure has been a subject of speculation in the City since Sainsbury’s agreed merger with Asda was blocked by the UK Competition & Markets Authority in April.

Sainsbury’s had also been suffering operationally as Coupe’s focus was fixed on the deal, with its sales volumes consistently the poorest of the ‘big four’ supermarkets for many months.

But a Sainsbury’s spokesperson denied there was anything going on, saying: “Every responsible business has potential succession plans for its CEO. This is nothing new.

“We are not talking to internal candidates about succession planning for Mike and have been clear he has the full support of shareholders and the board.”

Broker Shore Capital said its “struggled to see merit” in replacing Coupe and that it would have been “lunacy” to do so immediately following the collapse of the Asda deal.

“After that corporate failure... Sainsbury is back focused upon the day job, necessarily, and we sense that progress is being made in stabilising deteriorating store standards whilst work continues on its price file, which against favourable multi-year comparatives, may be stabilising.”

Sainsbury's shares, down 45% over the past year, were up over 4% to 190.75p by lunchtime on Monday.

Quick facts: J Sainsbury PLC

Price: £2.15

Market: LSE
Market Cap: £4.74 billion
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