Compass launches search for Bailey's replacement

Compass Group has begun its search to replace embattled group chief executive Mike Bailey.

Its nominations committee, headed by chairman-elect Roy Gardner, has appointed boardroom headhunter Jan Hall to come up with a short-list.

"Roy has started the search by asking for a beauty parade of people," said Compass non-executive deputy chairman Peter Cawdron.

After three profit warnings in a year, Bailey has come under increasing pressure from the City to step down quickly following his announcement that he would leave some time during 2006.

Dresdner Kleinwort Wasserstein analyst Karl Green said: "Bailey is now regarded as a genuine liability. The fact he may want to stay on honourably and not take a pay-off is irrelevant."

Richard Singleton, director of corporate governance at institutional investor F&C, said the future chief executive's relationship with Gardner was key. "They both need to be entirely in agreement. An understanding of the service industry would also be an advantage, catering or otherwise," he said.

Names already being touted include Gary Green, who heads Compass in North America, Whitbread chairman Anthony Habgood and ex-Aramark UK chief executive Bill Toner.

But one City source dismissed Green for being too similar to Mike Bailey and suggested Habgood already had too much on his plate at Whitbread.

Toner rejected the speculation. "This is an old story. I've made no decisions about the future yet."

A source close to Toner added: "I don't think he'd be interested. He's been at the Bunsen-burner level before and I'm not sure he'd fancy a return to that corporate world."

By Tom Bill

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