Swann is Royal Mail favourite

By JON REES, MAIL ON SUNDAY FINANCIAL CORRESPONDENT and TOM MCGHIE, MAIL ON SUNDAY SENIOR FINANCIAL CORRESPONDENT
Updated: 19:40 EST, 3 April 2010

Kate Swann, chief executive of WHSmith, has emerged as favourite to succeed departing Royal Mail boss Adam Crozier, who is taking over as ITV chief executive.

She is understood to be the preferred candidate on a shortlist of three put forward by headhunting firm Egon Zehnder.

Swann has been linked to several chief executive jobs, including as a replacement for Sir Stuart Rose at Marks & Spencer.

Crippling strikes at Royal Mail over the past few years have exacerbated the business's financial problems

Any pay award offered to Swann is likely to reflect her current earnings, which last year topped £1.4million, including bonuses of £896,000.

She is credited with turning round WHSmith, which was failing when she arrived in 2003.

Her appointment may be controversial if the Government is forced to pay her a 'golden hello' to cover part of her long-term incentive bonuses of about £9million.

Swann has clashed with postal unions - in 2007 they threatened to boycott the chain after it was announced that 70 Crown post office sites would be closed and transferred to WHSmith stores.

WHSmith and Royal Mail refused to comment.