UK

New Tesco Chief Takes Over As Investor Cuts Stake In 'Risky' Retailer

01/09/2014 13:13 BST | Updated 01/09/2014 13:59 BST
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A customer leaves a Tesco Metro supermarket store, operated by Tesco Plc, in London, U.K., on Friday, Aug. 29, 2014. Tesco Plc unexpectedly slashed its dividend and reduced investment as the largest U.K. retailer was squeezed between German discount chains and upscale stores such as Waitrose, driving the stock to the lowest in almost 11 years. Photographer: Chris Ratcliffe/Bloomberg via Getty Images

Tesco was left reeling today after a major investor slashed its stake in the troubled retailer just as Dave Lewis took over as its new chief executive.

The supermarket's share price fell 1.5% to 226.40p early this morning after the Sunday Telegraph reported that Harris Associates had sold nearly two thirds of its stake from around 3% to 1% of the business over concerns that it had become "too risky".

David Herro, chief executive of Harris Associates, said: “We want to hear a clear and coherent strategy about how to get this thing moving again."

Lewis joins the retail giant from Unilever, having started a month early after Tesco was forced only last week to issue another profit warning and slash its dividend to shareholders by 75%.

His predecessor, Philip Clarke, was forced to resign after the retailer revealed its worst trading figures in 40 years.

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Lewis tried to set out some of his vision for Tesco in an interview with the Evening Standard today, pledging to offer a "fresh perspective".

Explaining why he took the job at Tesco, Lewis said: “I needed to find out for myself whether I can lead a whole business. Some people think that is crazy given some of the jobs I have done but actually I don’t think you know whether you can truly lead a business until you sit in that seat.”

He added: "Phil Clarke is a great retailer. The issue for Tesco is, is that what they need now? Because great retailing in that seat hasn’t been the thing that has worked, so they do need a fresh perspective.”

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