A group of major Ocado shareholders are pushing the board to rethink plans to replace chief executive Tim Steiner, as the retailer faces a growing split over the future of its long-standing boss.
Several top 10 investors have written to Ocado’s board in recent days to express support for Steiner, according to the Financial Times, after the online grocery and technology group confirmed it was working on long-term succession planning.
Ocado said earlier this week that its chief executive and board “continually engage in long-term succession planning” and regularly speak with potential candidates.
However, the latest investor intervention has raised the stakes around Steiner’s future, with some shareholders understood to be concerned that an abrupt exit could destabilise the business at a critical point in its turnaround.
Steiner co-founded Ocado 26 years ago and has remained the driving force behind its shift from online grocer to global grocery technology provider.
Under his leadership, the group pioneered online grocery in the UK before licensing its automated warehouse technology to retailers around the world.
However, Ocado’s share price has fallen sharply from its pandemic highs as the online shopping boom faded and some international partners scaled back their ambitions.
Investor confidence was hit again after US partner Kroger moved to close three Ocado-powered fulfilment centres following weaker-than-expected performance.
Ocado has since sought to broaden its technology offer, including store-based automation for retailers that want to fulfil online orders from existing shops rather than large automated warehouses.
The business also recently secured a software deal with Asda, which will use Ocado’s technology to support its online grocery and home delivery operations from next year.
According to the FT, the push to accelerate succession planning has been led by chair Adam Warby and board member Jörn Rausing, a long-term Ocado backer with a 10.4 per cent stake.
The board had reportedly been preparing to announce Steiner’s departure, but opposition from some investors has led to further discussions.
If Steiner were removed, shareholders could attempt to call an extraordinary general meeting to challenge the decision. UK company law allows shareholders with at least 5 per cent of voting capital to request such a meeting.
Some investors are said to prefer an amicable resolution that avoids a public fight over the company’s leadership.
The succession debate underlines the challenge facing Ocado as it tries to convince investors that its technology model can deliver sustainable returns after years of heavy investment.
While Steiner’s deep knowledge of the company’s automation platform is seen by supporters as a major asset, his central role has also long been viewed as a governance risk.
Ocado declined to comment beyond its earlier statement on long-term succession planning.
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