Peter Cowgill, arguably the most successful British retailer of the past two decades, dramatically stepped down this evening as executive chairman of JD Sports amid speculation that he was overthrown.
His departure, effective immediately, was announced just 12 minutes before the close of today’s stock market session and the news immediately sent shares of JD Sports down just over 6% – wiped £377m off the company’s market value.
Announcing the move, JD Sports said that, as a result of its ongoing review of its governance practices and internal controls, it has decided to accelerate the separation of the roles of chairman and chief executive officer. onion.
In July last year, JD announced that it would split the roles of chairman and chief executive officer for the next 12 months following criticism of corporate governance by shareholders.
Some investors in JD have long been concerned about the power Mr. Cowgill holds on the board.
He’s been running JD – the company that describes itself in its marketing as the ‘King of Trainers’ – without a CEO since Barry Bown left in 2014.
Those concerns were heightened when in February the company was fined £4.3 million by the Competition and Markets Authority for not having safeguards in place, sharing commercially sensitive information. and failed to notify the regulator of the meeting between Mr. Cowgill and Mr. Bown, who became chief executive officer of Footasylum, which JD had previously owned but was forced to sell by the watchdog for reasons due to competition.
Some shareholders have also contested the decision to pay Mr Cowgill a £4m bonus after a year in which JD took money from taxpayers to reduce business and employee compensation rates during the COVID lockdown. .
JD said Wednesday night that Helen Ashton, currently a non-executive director at JD Sports and chair of the company’s audit and risk committee, will become interim non-executive chairman.
Ms. Ashton, who joined JD’s board last November, has previously held executive-level roles at online fashion retailer ASOS, Lloyds Banking Group and Barclays.
Peter Cowgill, executive chairman of JD Sports
Kath Smith, now a senior independent director at JD, will become interim chief executive officer. She previously worked in the field as the CEO of brands Adidas and Reebok and at outdoor clothing group The North Face.
“The business has thrived under Peter’s leadership to become the world’s leading omnichannel retailer with a proven strategy and clear driving force,” said Ms. Ashton.
“However, as our business became larger and more complex, it became clear that our infrastructure, governance, and internal controls were not evolving at the same pace.
“As we capitalize on the huge opportunities ahead, the board is committed to ensuring that we have the highest standards of corporate governance and controls consistent with an FTSE-100 company. to support future growth.”
Speculation that Mr Cowgill, 67, is nearing the end of his time at the company has been growing since in January this year he sold £21m worth of shares in JD – or half of the company’s shares. he in the company.
Mr. Cowgill’s departure brought the curtain down on one of the most successful retail careers in recent times.
The Manchester United supporter, known in retail for his workaholic, seven-day-a-week approach, has led since 2004 and took JD Sports from a small retailer to an FTSE member. 100 with more than 2,500 stores worldwide, until recently valued at more than £8 billion.
His genius was to identify the emerging trend of so-called ‘sports’ and discovered that four brands – Reebok, Nike, Puma and Adidas – were set to dominate the field.
He’s built a close relationship with all of them and, unlike his rival Mike Ashley at Sports Direct, has gone to great lengths to embrace those vendors closely rather than abandon them.
Last November, stockbroker AJ Bell calculated that, since becoming executive chairman in 2004, Cowgill has generated a total return to shareholders of more than 15,000% – compared with just 211%. of the FTSE 100.
Mr Cowgill is credited with defining trends for so-called ‘sports’
Mr. Cowgill, who grew up in Kearsley, a suburb of Bolton, was an entrepreneur from an early age, selling books on the carpet from outside his family’s front door.
Distinguished in school for his excellent numeracy skills, he studied at the University of Hull before qualifying to become a chartered accountant but soon left the company he qualified for to start his own accounting business. himself, Cowgill Holloway, at age 28 on Bolton barbershop. David Makin and John Wardle – J and D in JD Sports – were among his first clients and he ended up working with them.
Renowned as a stand-up, despite his wealth, he prefers drinking with his old friends at his local, Spread Eagle in Kearsley, rather than the high life.
Despite complaints from some investors about JD’s corporate governance, Mr Cowgill’s departure is likely to be greeted with disappointment in some areas of the City, where he has remained. a substantial fan club.
Eleanora Dani, at investment bank and stockbroker Shore Capital, said Mr. Cowgill was integral to JD’s success. She said that, although the separation of his roles had been marked, a gradual process was expected, with Mr Cowgill remaining as chairman for a few years.
She added: “The company is highly regulated with excellent cash generation, tight inventory and cost control. In our view, JD Sports remains the best retailer in its class. …however, we are disappointed to see Mr. Cowgill leave and look forward to hearing more from the company.”
