Boots boss reveals 900 jobs will be lost

By Rupert Steiner for the Daily Mail
Updated: 03:42 EDT, 5 October 2010

Fresh from presiding over the near-collapse of Halifax Bank of Scotland, which led to thousands losing their jobs, Andy Hornby is now wielding the axe at Alliance Boots.

Axeman: Hornby back in limelight as Boots announces cuts

The controversial former HBOS chief was thrust back into the limelight yesterday after the firm announced it is slashing 900 roles from the group's Boots the Chemist operation.

The latest blow to staff follows a decision in January this year to shut down the final salary pension scheme.

Hornby, who took up the Alliance Boots hot-seat a year ago, signed off the job losses as part of a three-year costcutting plan aimed at saving the group £56m a year by 2013.

Since HBOS was controversially merged with Lloyds TSB and subsequently rescued by the Government 18 months ago, more than 16,000 jobs have been cut at both banks.

Alex Gourlay, head of the firm's Health and Beauty division, defended his boss.

He said: 'Clearly he's involved with decisions but this one was absolutely mine.'

The bulk of the job cuts will be made at Boots' Nottingham head office, with administrators and middle managers taking the brunt.

Frontline shop workers will not be affected.

The announcement comes less than six months after Alliance Boots joined an elite band of high street billionaires, when it posted annual profits of £1bn.

While the business is in rude health, Gourlay claimed the cuts were all about efficiency.

'This is not a cost-cutting exercise at all,' he said.

'It's about becoming efficient and freeing up resources and cash.

Since 2007 we have undertaken a number of steps to make our business more robust, investing significantly in our stores.

'This latest phase will enable us to be stronger and more agile for the long-term future.'

Alliance Boots employs 7,500 staff in Nottingham and 70,000 employeers nationwide, but Gourlay hopes many of the 900 will be redeployed in other parts of the business.

'Our intention is to be open and transparent about how we see the future,' he said.

'But we understand the impact that today's announcement may have on our people.'

Back in 2007 Italian billionaire Stefano Pessina and private equity house Kohlberg Kravis & Roberts took the pharmacy giant private in a £12.4bn deal at the top of the market.

It was one of the last big debt-funded deals before the downturn The group is still weighed down by £8.3bn in loans.