Everything Coming Up Roses for Sir Stuart Rose

Some business leaders are known for building companies. Some are known for making audacious takeovers. Then there is another category for Sir Stuart Rose, a leader who has fought off hostile advances from other investors in the face of seemingly overwhelming odds.

And Rose is about to start a new chapter in his professional life as he recently stepped down from his role as executive chairman of U.K.-based retailer Marks & Spencer after six years at the helm, during which time he had to fend off a £9.1 billion ($14.5 billion) bid from fellow retailer Philip Green, steady the nerves of the company’s 65,000 employees and return the business to growth.

On almost all counts, Stuart’s reign at Marks & Spencer has been positive. The share price of Marks & Spencer (LSE: MKS) has risen in recent months and was trading steadily in the upper 300s last month; a massive refurbishment of the group’s 700 UK stores (and many of its 300 further stores worldwide) is underway; its earnings and profitability are back into positive—if unspectacular—territory and, importantly from Rose’s point of view, it remains un-acquired.

In January 2011, Rose took up his next challenge, as he joined the European advisory board of private equity firm Bridgepoint, one of the largest PE firms in the United Kingdom with such portfolio companies as Pret A Manger (which was bought for £500 million, or $800 million, in 2008), clothing store Fat Face and HobbyCraft (acquired in April 2010 for more than £100 million, or $160 million).

“He’s had a fantastic business career and has unparalleled experience in the retail world where Bridgepoint has made substantial investments over the years,” says Bridgepoint Managing Partner William Jackson. “It will be great to have him on board. Stuart has done a lot of retail turnarounds and driven business change, which is what we do in private equity.”

Some might question whether a man who has thrived under the intense scrutiny of investors, customers and the media for so long would enjoy the quieter world of private equity, but he says that he’s relishing the chance to leave the public stage.

“I’m looking for some lucrative fun,” says Rose, who owns a private Cesna plane and has a bit of a reputation as a party-going fun-loving person. “But if push comes to shove, I’ll drop the ‘lucrative.’”

Rose has invested his money in Armit, a wine producer, which supplies many of the region’s best restaurants and hotels and which recently sold a 75% stake to a Dutch rival, valuing the company at £14 million ($22.4 million).

As with many of his choices, Rose’s investment proved to be a shrewd one and, over the years, they have made him extremely wealthy.

Rose—born in March 1949 in England—has grandparents on his father’s side who were Russian émigrés and who fled to China after the 1917 Revolution. His mother’s side is English, Scottish and Greek. From early beginnings in England, the family moved to Tanzania when he was young, schooling Stuart at a Roman Catholic Convent in Dar es Salaam. At the age of 13 he moved back to England, attending the Quaker Bootham School in York.

After an administration job at the BBC, Rose joined Marks & Spencer in 1972 as a management trainee, staying for 17 years before joining the Burton Group as CEO, which he left in 1997. At retailer Argos, he was appointed to defend the company from a takeover bid by Great Universal Stores. Although GUS succeeded in acquiring the company, Rose is said to have negotiated an increased price, further raising his stock in the business world.

After a stint at Booker plc, Rose joined the Arcadia Group as CEO in 2000 but left in 2002 when the group was acquired by Philip Green, who would later mount the hostile bid for Marks & Spencer. As part of this deal, Rose made £25 million ($40 million) for having turned around the fortunes of the group.

Once he joined Marks & Spencer in 2004, Rose repeated this performance and rejuvenated the brand, fighting off Philip Green along the way. He was named ‘Business Leader of the Year’ in 2006 by the World Leadership Forum and was knighted in the 2008 New Year Honours list.

Smash-and-Grab

He’s had a fantastic business career and has unparalleled experience in the retail world where Bridgepoint has made substantial investments over the years. It will be great to have him on board. Stuart has done a lot of retail turnarounds and driven business change, which is what we do in private equity.

William JacksonManaging PartnerBridgepoint

During the period of tussling over Marks & Spencer, Rose once declared that private equity firms were little more than “smash-and-grab merchants,” a phrase that annoyed many in the industry.

“I think to characterise it as smash-and-grab is an attempt on the part of some who fear its activities for one reason or another to defend themselves,” says Sir Ronald Cohen of Apax Partners. “I don’t think it’s an accurate characterization of what the industry does.”

Bridgepoint was spun out of NatWest in 2000 via a management buyout and has long seen Rose as a good fit. He was approached in 1997, when he left Burton, but was unmoved, clearly believing that he had another few years at the sharp end of retailing. His role now will be to advise Bridgepoint on market trends and ‘all stages of its deals,’ according to company literature.

Despite Bridgepoint owning retail companies, Rose has kept to his promise, made in late 2009, not to take on another big retail job.

“If you ever see me go near another one, shoot me,” he told journalists when announcing that he would leave Marks & Spencer. “I’ll hopefully be able to go to a few more parties, as I’ve missed out on the party scene for the last couple of years, and I’ll be able to have a bit of fun.”

There has certainly been no shortage of offers. He also serves as chairman of Business in the Community, a government initiative to mobile businesses to benefit communities. In November 2010, he joined U.K. Foreign Secretary William Hague, Rajan Bharti Mittal of Bharti Enterprises in the joint U.K.-India Business Leaders Climate Group, an initiative which aims to bring together private equity and venture firms, along with technology innovators in both countries to develop clean technologies, boost economic growth and cut carbon emissions.

“It’s absolutely vital that India and the UK work together to create sustainable low carbon economies and greater business involvement in shaping low carbon solutions will help make this a reality,” Rose said in a press release.

The initiative demonstrates that Rose understands the potential for private equity to act for the public good, rather than smashing-and-grabbing.

In general, Rose is regarded as an excellent model for how business leaders should act and the example they should set. He has consistently pressed for Marks & Spencer to be more environmentally responsible, by reducing waste and using unsold food as fuel to power the company’s heating systems, recycling plastic bottles and reducing plastic carrier bag use.

In his private life, he likes to be as green as possible, owning a wormery to create compost for his garden from his own waste food. He drives a BMW 7 series, rather than a Bentley or a Rolls Royce—the cars of choice for the more flamboyant British millionaire—and he takes his holidays in the unglamorous island of Sardinia. He is a passionate cricket fan and is hoping to attend a match between the satirical publication Private Eye and a BBC news team at Arundel Castle in the summer, where he will be the guest of honour.

Speaking about his management style, Rose argues that the trend for barking at employees, popularized by TV program “The Apprentice” is misplaced.

“Just as we mustn’t demonise business, we mustn’t stereotype business and suggest the only way to run it is to hire and fire, or do down colleagues,” he says. “It’s about teamwork, it’s about diligence, it’s about being as full a man as you can be.”

While Marks & Spencer will miss Rose’s warmth, humour, energy, strategic vision and simple good sense, the world of private equity is gaining a highly valuable asset, for which it should be profoundly grateful.