Brett Blundy has poached Smiggle boss John Cheston from Solomon Lew’s Premier Investments

Brett Blundy has poached the boss of stationery store Smiggle from Solomon Lew’s Premier Investments to run Lovisa. It comes just months after luring Mark McInnes over.

Smiggle boss John Cheston, Premier Investments chairman Solomon Lew and then Premier Investments CEO Mark McInnes.

Two of the nation’s leading retail billionaires, Solomon Lew and Brett Blundy, have temporarily put aside wrestling over shoppers and money to instead battle over something just as important – chief executive talent – with the highly respected boss of stationery store Smiggle, John Cheston, poached by Mr Blundy’s jewellery store Lovisa right from under the nose of Mr Lew’s Premier Investments.

Although Mr Lew’s Premier Investments, which owns Smiggle, can keep hold of Mr Cheston for another 12 months as he serves out his notice the timing is extremely poor as the billionaire chairman and major shareholder in Premier Investments looks to fashion a demerger and spin off of Smiggle as an independently listed company as early as January. But Mr Lew will now have to do so without the man who has led Smiggle for more than a decade and taken it global.

But in another twist, making the poaching of Mr Cheston by Lovisa even more juicer for gossip and corporate intrigue, is the potential part played by former Premier Investments retail boss and close confidant to Mr Lew, Mark McInnes, who only in February joined Mr Blundy’s private BBRC investment vehicle in a newly created role of global chief executive of retail and consumer.

Mr McInnes, who is also the former boss of department store David Jones, spent almost 10 years running Mr Lew’s listed fashion and investment vehicle, working closely with Smiggle’s Mr Cheston who ran one of the key profit engines for the Premier Investments company. Mr McInnes remained incredibly close to Mr Lew after he left Premier Investments at the end of 2021 and at one point was believed to be favoured by Mr Lew to be the next CEO of Myer, of which Mr Lew’s Premier Investments is the largest shareholder.

But now Mr Cheston will be joining the Blundy camp, via Lovisa, alongside Mr McInnes.

Mr McInnes was unavailable for comment on Monday, as was Mr Lew.

Investors quickly cast their early vote on the CEO news, fretting at the loss of Lovisa’s outgoing and highly successful CEO, Victor Herrero, to send shares in Lovisa down 10.35 per cent to $30.40. Premier Investments shareholders also showed some concern about the pending loss of the boss of one of its key growth engines ahead of a possible demerger, with Premier Investments shares sliding 4.1 per cent to $28.83.

Mr Blundy, who these days is based in Monaco, is the chairman of the $3.3bn global jewellery chain Lovisa as well as its largest shareholder, with a stake of 40 per cent, and was keen to snare Mr Cheston to lead the retailer as current CEO Mr Herrero approached his retirement.

Mr Herrero, who last year was one of the highest paid executives of an ASX company as he trousered just under $30m, will now depart Lovisa on May 31, 2025 with Mr Cheston to take the reins a few days later on June 4. In his new role he will oversee Lovisa’s 854 stores that are dotted across the globe, including a strong presence in Europe, the US and the middle east, and which has become one of the few success stories of an Australian retailer winning international shoppers and succeeding overseas.

Mr Blundy, like Mr Lew, a billionaire retailer, was crowing on Monday about the hiring of Mr Cheston.

“The board and I are pleased to announce that Victor has entered an amended 12-month contract. The board and I are also pleased to announce that John Cheston will join us as CEO … John is a highly successful global retailer and will join Lovisa at a very exciting time as we continue our global growth.”

Under the terms of Mr Cheston’s employment at Lovisa, he will be paid fixed remuneration of $2.5m annually, as well as long term incentives that could be as much as $7.05m over his first three years as CEO.

Meanwhile, for Premier Investments and Mr Lew the loss of Mr Cheston comes as the company was putting together a planned demerger and of the stationery retailer juggernaut Smiggle, as well as its sleepwear brand Peter Alexander, set for early in the new year.

Smiggle boss John Cheston at its Chadstone store. Picture: Caremelo Bazzano

Such is the growth potential of Smiggle, especially around a global expansion, that it formed the core of a plan by Mr Lew to spin out Smiggle from Premier Investments and become an independently listed ASX company.

But those plans now look unsettled, after Lovisa announced Mr Cheston would jump ship and cosy up to a different retail billionaire.

A Premier Investments spokeswoman said on Monday put a more positive spin on the loss of Mr Cheston to a rival retailer, and just at a time when investors were contemplating the potential of an independently listed Smiggle.

“The company was informed of John Cheston’s resignation as managing director of Smiggle and notes he has provided 12 months’ notice.

“Premier Retail remains well positioned in its leadership structure, and will work through a constructive transition and succession plan in the months ahead.”

It will cause a major headache for Mr Lew. In March, Mr Lew provided a glimpse into the future of his $5bn Premier Investments empire that would see a planned demerger of sleepwear retailer Peter Alexander and Smiggle into newly listed companies where both brands – unshackled and autonomous – can chase new growth opportunities, especially overseas.

Under that plan, which has been at least a year in the making, the high-growth stationery chain Smiggle could list by the end of January as a stand-alone business, while it was also exploring the demerger of its sleepwear chain Peter Alexander into another ASX-listed entity during calendar 2025.

Now Mr Lew will have to likely pursue that demerger plan without its long serving CEO, Mr Cheston.

E&P Capital retail analyst Phillip Kimber said it was disappointing to see a well regarded CEO such as Mr Cheston leave Smiggle just as its demerger was being considered.

“As previously announced, Premier Investments is working towards a demerger of Smiggle by the end of January 2025. Premier Investments has noted “any demergers will be subject to further review and final board approval as well as regulatory and shareholder approvals’.

“It’s disappointing to lose Mr Cheston ahead of a potential demerger, and we note he is well regarded by the investment community. We also note that Premier Investments continues to have a very strong management team, including a chairman (Mr Lew) who remains very active in the business.”