M&S's Rose set for showdown

By Mark Potter

LONDON (Reuters) - Marks and Spencer (MKS.L) boss Stuart Rose, lauded for reviving the landmark retailer just a year ago, is battling to save his job after a big profit warning and bungled management changes.

Rose needs to come up with a clear strategy on how to turn around the group's flagging food business and convince investors he is building a strong management team if he is to remain at the helm for long, analysts and investors say.

His chances of success, some think, are finely balanced.

"There is probably a 40 percent chance that in due course he will be forced to step down or resign," Pali International analyst Nick Bubb said in a research note.

Rose's most immediate challenge is the company's annual shareholder meeting next Wednesday, when investors will vote on his controversial move from chief executive to executive chairman, against corporate governance guidelines.

This had already raised questions about his leadership.

Corporate governance consultancy PIRC last week advised clients to vote against Rose's election as executive chairman, saying that combining the roles of chief executive and chairman gave rise to "a dangerous concentration of power."

That was before a shock profit warning on Wednesday, which sent the stock price tumbling nearly 25 percent and also fuelled doubts about his strategy.