Next shares dive as Wolfson announces plans to depart

SHARES in Next, the fashion retailer, fell sharply yesterday when the company announced its chairman Lord Wolfson of Sunningdale is to step down as chairman after the annual meeting in May. The shares shed 36p to 792.5p even though the group announced that Sir Brian Pitman, chairman of Lloyds TSB, the banking group, has been appointed a non-executive director and will move up to the chair on Lord Wolfson's departure.

Lord Wolfson has been chairman of Next since 1990 and, together with its chief executive David Jones, succeeded in bringing the company back from the brink of financial disaster. Since 1990 the shares have risen from 12.5p as Next became a retail powerhouse and a constituent of the FTSE 100.

Analysts said the fall in Next shares was due in part to disappointment that a merger between Next and Great Universal Stores, where Lord Wolfson is also chairman, had diminished. However, one retail analyst said: "The share price fall is a bit of a surprise as it was expected that Lord Wolfson would step down before long and not many people really believed that GUS was going to bid for Next anyway." Other analysts said the market was looking for an excuse to take profits.

Lord Wolfson was appointed chairman of GUS in September and is embroiled in a pounds 1.6bn hostile bid for Argos. GUS has also paid pounds 1bn for Experian, the US database group, and signed a pounds 900m property joint venture with British Land. The increasing activity of GUS in the corporate arena has made it difficult for Lord Wolfson to remain as chairman of both companies.

There was speculation yesterday that the wobble in Next shares was due to the departure of Hilary Santell, the group's head of womenswear buying. However, analysts said Ms Santell had left late last year after a riding accident and that there was nothing untoward about her departure.