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US buyout firm Clayton, Dubilier & Rice has hired former Tesco boss Sir Dave Lewis as an operational adviser as it looks to strengthen its consumer and retail team so it can explore new investments.
CD and R said Lewis, who spent almost three decades at consumer goods group Unilever, will help source and execute deals as well as support its portfolio of businesses across Europe.
He joins a team of other operational advisers, including former Boeing chief executive Jim McNerney and former Marsh McLennan leader Dan Glaser, as well as Sir Terry Leahy, who also ran Tesco from 1997 to 2011.
Leahy, who joined CD&R in 2011 and chairs its UK supermarket chain, Wm Morrison, told the Financial Times: โWe need to expand our team because there are many more opportunities. . . and we do not want to have bottlenecks in growth.โ
Leahy said that in recent years CD&R had "never been able to do a deal with the consumer," adding: "They've all been retail deals, and we've also never done a consumer services or entertainment deal."
"CD&R is a high-performing company with really good people and the way they do business is important to me," Lewis told the Financial Times. He chairs consumer health group Haleon and was instrumental in reviving Tesco's fortunes during his tenure after an accounting scandal in 2014.
Clive Black, retail analyst at Shore Capital, said it was "a surprising appointment" and added: "There is no one who knows consumer products better than Lewis."
CD&R invests in six main sectors, including consumer and retail. In 2021, the group bought Morrisons in ยฃ10bn deal. It also owns assets including gas station operator Motor Fuel Group and part of car windshield repair company Belron.
CD&R has explored the possibility of selling MFG. Under his ownership, Morrisons sales have lagging behind many UK competitors.
Lewis said he had โno formal involvementโ with Morrisons or MFG. "If I have a mission, it is to think about what investments could be added to the portfolio, but there is already a fantastic team working on those two investments."
However, Black commented that it would be a โmissed opportunityโ if CD&R did not involve him in Morrisons due to his achievement of a โcomplete turnaroundโ at Tesco.
Dave Novak, co-president of CD&R, told the Financial Times: "We are very aware that our offering in each of [CD&Rโs existing consumer and retail] Companies have to be what the consumer wants and be available when the customer wants it at the moment. [right] worth."
During his tenure, CD&R had made "several successful deals", Leahy said, including the highly successful initial public offering (IPO) of UK securities retailer B&M. ยฃ1 billion payday for CD&R and the Arora family at the time, and the acquisition of MFG.
โWe have actually created two FTSE 100 companies,โ Leahy added, explaining that B&M was part of the UK large cap index and MFG would likely be part of the UK large cap index if it listed.
Last year, the company raised $26 billion for its largest buyout fund in its history, despite a broader slowdown in private equity fundraising.
Founded in 1978, CD&R is one of the oldest private equity firms. Its strategy focuses on trying to improve the operations of the companies it owns. This has been helped by a large number of executives it employs who have experience running some of the largest companies in the world.
