Outlook: Gent hangs up on the City at dawn of new mobile era

One by one they go. The changing of the guard at the head of European telecoms has added another name to its list with Sir Christopher Gent's decision to hang up his handset at Vodafone. In the past 18 months we have seen Ron Sommer leave Deutsche Telekom, Michel Bon ring off at France Telecom and BT part company with both its chairman and chief executive.

The link between them all is that the right men for the boom times are not necessarily the right men for the lean times. Sir Christopher enjoyed the plaudits on the way up as he built Vodafone into a UK telecoms champion, planting British flags around the world with an increasingly ambitious sequence of takeovers. With the day of the blockbuster deals now over and having missed out on the takeover of Cegetel, perhaps Sir Christopher decided that this is the right time to go. The more detailed business of making deals work was probably rather less appetising.

It has been all too obvious that Sir Christopher has been wounded by the barrage of criticism that he has been subjected to in the past year, during which the juxtaposition between Vodafone's falling share price and his multi-million pay packet has looked increasingly uncomfortable.

Lord MacLaurin of Knebworth, Vodafone's chairman, has said that Sir Christopher has been "scarred" by the media coverage. This summer he even said Sir Christopher might jack it all in and take a job in the US or that Vodafone might up sticks and move abroad. None of that was ever really likely, of course, but the brickbats left their mark.

That the pay rows followed an embarrassing incident during the Mannesmann bid surely must have compounded his resentment. Enjoying himself at a cricket match in South Africa during the protracted bid negotiations, Sir Christopher thought he was talking off the record when he treated newspaper guests to an impression of Klaus Esser, his German counterpart at Mannesmann, complete with faux German accent. The episode immediately appeared in the British newspapers and Sir Christopher appeared to pull the shutters down on the media there and then. He became increasingly distant and defensive, rarely granting interviews even when there were important messages to be conveyed.

With a new wife and two young children it is perhaps no surprise that Sir Christopher has decided there is more to life than Vodafone, even for a man who has said he works to live rather than the other way round.

In the short term, Sir Christopher will probably be remembered as a deal-maker who paid top dollar for big deals while earning himself a fortune in the process. The board's decision to pay him a £10m bonus following the Mannesmann deal was clearly a mistake and shareholders never forgot it. That half of it was eventually paid in shares rather than cash was only because of the furore which ensued. But the company failed to learn its lesson, landing itself in hot water again this year with another pay row at a time when the company was reporting the biggest loss in UK corporate history due to heavy write-offs. Sir Christopher's decision to go early also gives the lie to Vodafone's claim just months ago that it needed to pay top money to retain top people. It obviously didn't work.

But these recent squabbles should not overshadow Sir Christopher's undoubted achievements. Since taking over as managing director of the operating division of the old Racal in 1985, he has built a mobile business, in effect, from scratch. When he became chief executive in 1997 Vodafone had a market value of £7.7bn. Now it is £75bn. That kind of value creation for shareholders speaks for itself.

The fact that Sir Christopher built Vodafone in a boom industry misses the point. Many other mobile companies have been brought to the brink of collapse by debt or quit the sector altogether. Vodafone remains a solid company, with strong cash generation and a growing subscriber base. As a consequence there has never been the kind of baying for heads to roll at Vodafone that there has been at its European rivals in the past two years.

Sir Christopher has timed his leaving well. Vodafone shares have picked up substantially from their 80p low just two months ago and the recent launch of Vodafone Live has been well received. When he finally leaves next July he will do so just in time to take in the England v South Africa test match. I'm sure his cricketing chairman, Lord MacLaurin, will find him a seat.

As for the new man, Arun Sarin, he had not been seen as the obvious successor. However, he is younger, has an international background and has a reputation for openness that Sir Christopher lacked. Perhaps we can look forward to better communication in the future.

He faces a fresh set of challenges. Vodafone needs to prove that it can achieve economies of scale, that it can develop a global brand name and make a success of third-generation mobile. The one geographic issue is the United States, where Vodafone's 45 per cent stake in Verizon is a potential problem. If Vodafone really wants to be global it may need to take full control or sell up and buy something else. Alternatively, it could pull out of that market altogether. As a US citizen, with good relations with US investors, Mr Sarin is well placed to make that call. We do seem on course for yet more pay rows, though, as Mr Sarin jets in from San Francisco on a Gent-style bumper package.

As for Sir Christopher's next move, those close to him say he is unlikely to take up a portfolio of non-executive directorships. He has his eye on the political arena, apparently. And as a keen supporter of the Conservatives, he will surely be found a role somewhere.

Hunter's prey

Tom Hunter, the Scottish entrepreneur, will announce today that he has increased his stake in Allders, the department store group which is the subject of bid interest from the property group Minerva and the former Bhs chief executive, Terry Green. It follows his purchase of a 1 per cent stake on Tuesday.

All this is terribly confusing as Mr Hunter is supposed to be stalking House of Fraser, the rival department store retailer where he has built up a near 7 per cent stake. Salomon Schroder Smith Barney has now had to stand down from advising Mr Hunter as it also advises Allders.

Whatever can he be up to? Mr Hunter's team says his stake-building in Allders is simply to secure a "seat at the table" as consolidation in the department store sector gets under way. But he is not ruling out a bid for both and an eventual merger of the two which must surely be the end-game.

The worry for other shareholders is that this would rob them of the potential upside of a deal that has been discussed twice before. The only reason it failed last time was because the two sets of management couldn't agree who should run it.

The concern for Terry Green must be that he might miss out on another opportunity, having been passed over for the top job at Mothercare. The problem is that his chosen area of department stores is fast-disappearing into private hands. John Lewis Partnership has always been private and Fenwicks and Harrods are resolutely so. Harvey Nichols has just been taken over and there is a riskAllders and House of Fraser could slip away too. Debenhams, where Mr Green used to be chief executive, looks a bid too far at north of £1bn and is well-run by Belinda Earl. That leaves Selfridges. With a market value barely higher than its property assets and disappointment in the City over the departure of Vittorio Radice there is a deal to be done. Maybe Mr Green should get in touch with John Ritblat of British Land, which had a stake in Selfridges before. Or Donny Gordon of deal-hungry Liberty International. Worth a call, just to be on the safe side.

n.cope@independent.co.uk