PARIS (Reuters) - Georges Plassat was known as “The Cleaner” when at the helm of French retail group Vivarte, with a reputation as a ruthless cost-killer who could at times be harsh with the troops.
Now the 62-year old retail veteran is taking on the toughest challenge of his career — the top seat at Carrefour, the world’s second-largest stores group with annual sales of over 90 billion euros.
As new chief executive, the Frenchman with a solid track record for company restructuring must turn around Europe’s largest grocer to save it from a possible break-up.
“Carrefour is sinking and shareholders will be expecting Plassat to hit the ground running. There is no doubt that he has the biggest task in retail this year,” said Natalie Berg, director of global research at Planet Retail.
Plassat replaces Lars Olofsson, a former Nestle NESN.VX marketing executive, who after three years leaves a group in disarray.
Carrefour warned its profits would fall short of targets six times in a little over a year. Staff morale is the doldrums. The shares have lost 24 percent since Olofsson took over.
Plassat, a man who shuns the limelight, must pull off what Olofsson and a procession of chief executives before him failed to do: fix Carrefour’s struggling European hypermarket business and halt market share loss in the company’s core French market.
Plassat’s experience at Vivarte, owner of brands such as Andre shoes, Kookai womenswear and discount retailer La Halle aux Vetements, could be crucial in helping Carrefour revive its underperforming hypermarkets, analysts say.
His stroke of genius came in 2000 when he identified loss-making shoe retailer Groupe Andre as a bargain and eventually transformed it into the profitable Vivarte with sales of over 3 billion euros.
Plassat is described as a charismatic but tough boss, who can be harsh with staff when results are disappointing, telling a meeting of Vivarte’s managers he worked “Kalashnikov style.”
But Plassat, a father of three and a ski and opera buff, can
be endearing and accessible to a staff he is prompt to reward.
At Vivarte, Plassat granted employees three and a half months in additional wages at the time of the first leveraged buy out, says Karim Cheboub, CGT union representative.
Two restructuring plans and hefty job cuts at Groupe Andre won Plassat the nickname of “Georges The Cleaner” though Cheboub says: “One cannot deny that Plassat rebuilt the group’s brands.”
At Carrefour, where staff morale is low, Force Ouvriere union representative Dejan Terglav expects Plassat, who is known not to bother with red tape, to “shake things up” and “do some cleaning among managers.”
Terglav, who negotiated with Plassat during his years at Casino (CASP.PA), describes a “very direct man, with a clear vision of what he wants to achieve, a man easy to talk to even, but tough,”
Plassat, who is a shareholder of Vivarte and is used to dealing with private equity investors is expected to “stand up to Colony and Arnault,” the union representative said, referring to Carrefour’s powerful shareholders, France’s richest man Bernard Arnault and U.S. property group Colony Capital.
“He doesn’t like to be told — by people who don’t know — what he has to do,” a senior banker said.
Arnault and Colony have tried in the past to force asset sales and a failed property spin off to recoup some of the money they have lost since investing in Carrefour in 2007.
Media reports that Plassat, a graduate of Ecole Hoteliere de Lausanne and Cornell University, was about to take the helm at Carrefour lifted the stock by 8 percent last Thursday.
Plassat spent 14 years at retailer Casino, moving up from head of the catering division to CEO France before becoming group CEO from 1996 to 1997. He then spent two years at Carrefour Spain before heading to Vivarte in 2000.
“He is a strategist, a very independent man and a great professional, someone who can inspire his teams and take bold decisions,” said a former Casino executive who knows him well.
Plassat has however sometimes had conflictual relationship with shareholders. He had to leave Casino in 1997 after clashing over strategy with key shareholder Jean-Charles Naouri.
In 2002, Plassat left Vivarte after a dispute with its main shareholders the NR Atticus and Wyser-Pratte funds.
Plassat returned to Vivarte in 2004 when French private equity fund PAI Partners bought the company.
Reporting by Dominique Vidalon, additional reporting Julien Ponthus, Editing by Christian Plumb and Mark Potter