Ralph Lauren CEO to leave after differences with founder

REUTERS - Ralph Lauren Corp said Chief Executive Stefan Larsson, hired over a year ago to turn the company around, would step down following differences over the luxury brand's direction with founder Ralph Lauren.

Shares of the company fell as much as 12 percent to a more than 6-year low of $76.86 in morning trading on Thursday.

Larsson, who was credited with reviving sales at Gap Inc's popular Old Navy brand, was hired for his experience in managing fast-fashion businesses with efficient supply chains at companies such as H&M.

At the time, his appointment was considered a good fit for Ralph Lauren, which was seeking to reorganize and centralize business units and brands.

"The board, Ralph and I have over the last month worked very hard to find common ground," Larsson said on an earnings call with analysts.

Differences stemmed from the direction in which to take the company's product, marketing and shopping experience, he said.

The company's founder and American designer, Ralph Lauren, said they had different views on how to evolve the creative and consumer-facing parts of the business.

In his short tenure, Larsson had embarked on a major overhaul of the company, calling it the Way Forward Plan, which included shutting down underperforming stores, cutting back on inventory and shedding about 1,000 jobs.

However, the company is yet to realize the benefits of the restructuring program, with revenue falling for the seventh straight quarter in its latest earnings report on Thursday.

The company's shares have lost more than a fifth of their value since Larsson replaced the founder in November 2015.

Ralph Lauren said a search was being conducted for a new CEO. Until then, Chief Financial Officer Jane Nielsen will head the company's restructuring program.

Larsson, who will stay on until May 1, will get $10 million in severance pay over two years and his bonus for the company's 2017 fiscal year as part of his separation agreement.

He is also entitled to receive a pro-rated bonus based on his performance until he exits the company.

The company was recently in the spotlight for dressing up Melania Trump for Donald Trump's presidential inauguration, with #boycottralphlauren becoming a trending hashtag on Twitter.

Several top designers, including Tom Ford and Marc Jacobs, had publicly declined to dress Melania Trump for the inauguration.

(Reporting by Jessica Kuruthukulangara and Gayathree Ganesan in Bengaluru; Editing by Sriraj Kalluvila and Anil D'Silva)