Myer shareholder Solomon Lew meets Mark McInnes to fuel speculation over John King’s successor

Three days after Myer announced the planned exit of its chief executive John King, Myer’s largest shareholder Solomon Lew met with his former CEO Mark McInnes.

Myer’s largest shareholder, Solomon Lew, met the former boss of his Premier Investments fashion empire, Mark McInnes, just three days after Myer’s board announced its chief executive would leave, fuelling speculation McInnes might take the top job at the department store giant.

Mr Lew, who controls 25.8 per cent of Myer, is positioning himself to potentially play a role in choosing the next CEO of Myer. Current boss John King will retire at the end of next year and return to Florida where his family lives after steering Myer from losses to record profitability over the last five years.

Mr McInnes, a former boss of upmarket department store David Jones, stepped down from Premier Investments in late 2021 and is now a free agent on the lookout for his next retail role, having served out most of his non-compete clauses under arrangements with Mr Lew’s Premier Investments.

The breakfast meeting between the billionaire and the veteran retail CEO took place last Thursday at chic cafe James Said in the inner Melbourne suburb of Armadale, and the pair were seen dining for a few hours and later leaving together in a jovial mood. They held their breakfast meeting in a private room at James Said.

Current Myer CEO John King will step down from the department store at the end of next year. Picture: Stefan Postles

Myer was discussed, as was the current state of the retail sector, with the Lew camp increasingly concerned about a sharp downturn in consumer spending and an oncoming retail slump caused by rapid interest rate hikes and other cost of living pressures. Mr Lew’s Premier Investments has a large portfolio of clothing and fashion chains, including Just Jeans, Portmans, Peter Alexander, Dotti and stationery juggernaut Smiggle.

His ASX-listed Premier also holds the 25.8 per cent Myer stake.

It is believed that the retail duo discussed the future of Myer and the broader retail sector at length.

Mr McInnes and Mr Lew were one of the most successful and powerful tag teams in recent retail history, when Mr McInnes ran the retail arm of Mr Lew’s $3.4bn Premier Investments for a decade.

The breakfast rendezvous so soon after Myer announced the planned departure of Mr King comes at an interesting time in the ongoing Myer saga.

Mr Lew, a billionaire, has fought a long battle against the Myer board.

It is believed no offers were made, or jobs sought, over the convivial breakfast, but Mr McInnes would be a very strong candidate to run the nation’s largest department store.

It is doubtful that Mr Lew has the power and influence to pick the next Myer CEO.

Mr McInnes, a long-term friend and business associate of Mr Lew, was the chief executive of David Jones for 13 years and has proved himself a strong performer in running profitable department stores.

Premier Investments chairman Solomon Lew and CEO Mark McInnes at the 2018 Premier Investments AGM in Melbourne. Picture: Stuart McEvoy

Mr Lew currently has one of his nominees on the Myer board, Terence McCartney, but Mr McCartney doesn’t sit on the remuneration or nomination committees and is unlikely to have much say in who the next Myer CEO will be.

However, Mr Lew can use creep provisions to build his stake by 3 per cent every six months, and by the time of Mr King’s ­planned exit at the end of 2024 could control as much as a third of Myer.

Having more than 33 per cent of Myer could enable him to replace current Myer chairman JoAnne Stephenson and seek more board representation.

Mr Lew could also use his stake to call for an extraordinary general meeting next year to replace the board and impose his own choice for Mr King’s replacement as CEO.

Myer announced Mr King’s planned departure eight days ago.

Officially he is returning to the US to be with his family, but there is a view within the Lew camp that the Myer boss wanted to leave on a high and before retail conditions deteriorated further.

Mr McInnes might have other retail plans aside from a possibility of once more running a department store.

As revealed in The Australian’s Data Room last week, Mr McInnes has also been fielding offers and invitations from other billionaires, private equity, funds management and listed companies as he considers his next executive retail gig.