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Mosaic kicks off hunt for operations boss

Mosaic Fashions is on the hunt for a chief operating officer as it considers a bid by stakeholder Baugur to take the business private.

It is understood that privatising Mosaic would lead to the business looking to recruit a strong operational retail executive to bolster the management team and report to chief executive Derek Lovelock.

Last year, Mosaic acquired Rubicon Retail, which owns Shoe Studio Group, Principles and Warehouse, to add to Mosaic's portfolio of Coast, Karen Millen, Oasis and Whistles. Lovelock now runs a seven-fascia business and management resources are stretched.

One source said: "Baugur is looking at a number of options and a chief operating officer would be one of those. It is linked to the succession issue, and whoever comes in will come in underneath Lovelock."

Industry insiders have tipped Inditex UK managing director Mike Shearwood as the executive who could fill a broader management role at the group.

Shearwood, who was not available for comment, is known to have strong skills on the operational side of a fashion business, having built Zara to a 56-strong chain in the UK and Republic of Ireland. He also introduced three other Inditex brands - Massimo Dutti, Pull and Bear and Bershka - to the UK. Another source added: "Shearwood's name would be on anyone's list because he has the right skills, but Baugur has other names in pot as well."

Baugur, which holds a 36.8% stake in Mosaic, has tabled a privatisation bid valuing the business at £850 million including debt. It is understood Baugur had become disillusioned with the limited opportunities offered by the Icelandic Stock Exchange (ICEX). The source said: "It's a small market with low liquidity. Mosaic wasn't going anywhere on ICEX, which Baugur came to realise.

"It's about being able to get the structure right in a larger group and developing new areas of the business - such as e-commerce and global expansion - 'under the radar'. It would then be able to come back to the UK market as clean as a whistle."

Baugur managing director of retail Gunnar Sigurdsson told Drapers that further integration and investment into Mosaic was best done as a private company, adding that management changes were inevitable although nothing had been set in stone. "Change will be driven by the incumbent management team and we will finalise issues," he said.

One industry source close to Baugur indicated that the long-term plan was to float Mosaic on the UK stock market in three years, with Lovelock taking the chairman's role pre-flotation.

However, Sigurdsson denied that moving Lovelock to the chairman's role was an option.

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