Sainsbury's chairman Sir Peter Davis is to step down, the supermarket giant confirmed today.

The company said former group finance director of Lloyds TSB, telecoms group BT and gas exploration group BG, Philip Hampton, 50, would replace Sir Peter on July 19.

Sainsbury's thanked Sir Peter for "all his hard work on behalf of the company".

It said the financial skills of Mr Hampton and the proven retailing skills of chief executive Justin King would represent a powerful combination to take the group forward.

The move follows controversy over Sir Peter's record in his time as chairman of the supermarket giant.

The former boss of insurance group Prudential was awarded £2.4 million in shares for his work during the year to March 27, in which profits fell 2.9% to £675 million.

Sainsbury's has lost ground during the past 12 months to rivals such as Asda and Tesco in the face of stiff price competition, and its own restructuring drive has also had an impact.

The supermarket has responded by appointing Mr King, who joined the company as chief executive from Marks & Spencer about three months ago.

Thursday July 01, 2004