Primark is pushing ahead with plans for a huge global expansion and a potential split from its parent company.
Owner Associated British Foods (ABF) will announce in April whether its retail arm will be spun out into a new entity, say sources close to the issue. Last week ABF launched a review of its business, paving the way for a break-up of the £16 billion empire.
Bosses believe it could take just a year to get Primark – which has pop star Rita Ora on its books – ready to list as a separate firm in what would be a big boost for the London stock market. A decision is to be announced at the group’s half-year results, scheduled for spring.
News of a possible demerger comes after a volatile year for Primark as it hunts for a boss after Paul Marchant quit in a scandal over his behaviour.
Interim chief executive Eoin Tonge is the top candidate. He is seen as a safe pair of hands as ABF’s finance chief since April 2023 and he was finance boss and chief strategy officer at Marks & Spencer. But ABF is also looking at outsiders, including overseas candidates, sources said.
Investors believe the right person can lead it to complete against rivals such as China’s Temu and Shein, as well as Spain’s Inditex, the owner of Zara.
Planning ahead: Bosses believe it could take just a year to get Primark – which has pop star Rita Ora (pictured) on its books – ready to list as a separate firm
Retail analyst Jonathan De Mello said that Brits in the running could be Reiss boss Christos Angelides and ex-M&S execs Katie Bickerstaffe and Richard Price. Top bosses at H&M and Inditex could also be under consideration.
Primark is targeting the lucrative Gulf region with plans to open its first three shops in Dubai. It opened its first shop in the Middle East last month in Kuwait.
The US is also a key market. It has 33 stores there and plans 18 more, with a flagship Manhattan shop due next year.
But shareholders want the firm to pick up the pace, especially in developing markets such as India. One investor told The Mail on Sunday: ‘Primark must be bolder internationally. India has the world’s fastest-growing apparel market, and its young female demographic is seeing the sharpest rise in disposable income. It risks missing significant long-term growth opportunities.’
The value of a stand-alone Primark has yet to be determined, but retail analyst Nick Bubb said it could be over £10 billion. The Weston family, a billionaire dynasty established in Canada in the 1880s, controls 56 per cent of ABF through their personal vehicle Wittington Investments.
The family are keen to hold on to both parts of the business and ABF boss George Weston has said he would oversee the parts of the business that remain after a Primark split including its sugar production and grocery arms.
A new Primark board would be likely to include two Weston family members.
Primark accounts for half of ABF’s sales, which hit £20 billion this year, and it has 450 shops in 17 countries.
It was founded in Ireland in 1969 by Arthur Ryan, and Marchant was only its second chief executive, taking over from Ryan in 2009.
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