Tesco’s CEO, Dave Lewis, is quitting the UK-based retailer, in a surprise move announced on Wednesday.
Lewis, 54, was picked to run the UK’s biggest retailer in 2014 and his departure has come out of the blue.
“My decision to step down as Group CEO is a personal one. I believe that the tenure of the CEO should be a finite one and that now is the right time to pass the baton," Lewis said in a statement.
"Our turnaround is complete, we have delivered all the metrics we set for ourselves. The leadership team is very strong, our strategy is clear and it is delivering.
He will be succeeded next summer by Ken Murphy, a Boots veteran who until recently was the chief commercial officer of its U.S. parent company Walgreens Boots Alliance.
Tesco shares, which had almost halved in the months before Lewis started his turnaround, have climbed 40% on his watch.
However, the business is much smaller and less profitable than it was a decade ago, largely as a result of Lewis shutting down and selling operations and cutting prices to compete with discounters Aldi and Lidl.
Murphy will receive CEO employment terms in line with Tesco’s remuneration policy. His basic salary will be £1.35m (US$1.65m) per annum.
The Guardian reports that when Lewis – who earned the nickname “drastic Dave” for cutting jobs as part of his overhaul of Unilever’s UK business – took control the appointment was viewed as a risk because he had no retail experience.
But he set about dismantling the old Tesco model, ending its combative dealings with suppliers, lowering prices and improving store standards, according to the publication.