Advent ousts Alexander Mann founder ahead of IPO

His departure appears to centre around Advent's plan to create more of a corporate group culture so it can exit its investment in Alexander Mann over the next few years, probably through an initial public offering.

Sources close to the UK recruitment specialist said that the decision to remove Caan came after completion of a strategic review of the business conducted by PricewaterhouseCoopers on behalf of Advent International.

Caan, described by an associate as a "brilliant risk-taker and investor who built the group up by investing in people", is nevertheless said to have taken decisions that threw into question his strategic judgement.

One source close to Alexander Mann said: "It is not Advent's style to invest in a business and then kick out the founders. But we have shareholders in the business in terms of our management and others, and we need to show that it is being run in a strategic manner, with goals and objectives."

Chris Ross-Roberts, the group's finance director who came on board in 1999 at the time of the Advent investment, is to take over as acting chief executive. Alexander Mann said it was in the process of identifying a chief executive to replace Caan. No other management changes are expected.

John Singer, Alexander Mann chairman and international managing director at Advent, said: "Unlike many in the sector, Alexander Mann Group is trading profitably, even in the economic downturn, and is ahead of plan. We believe the group will see substantial growth in its chosen markets and is well placed to continue increasing its market share."

Alexander Mann has operations in Continental Europe, Australia and Hong Kong. It has 12m in cash reserves on deposit and "substantial commitments of banking facilities", according to Ross-Roberts. The plan, he said, was to create "a better group with more of a corporate culture and an initial public offering at a distant point in the future".

In the last few years Alexander Mann, which was founded in 1986, has successfully refocused its business around its 'solutions' model, which takes on the management of information as well as the resourcing needs of human resources departments.

Ross-Roberts said: "Advent recognises that there is a strong product here, but we need at least two years, given the current economic climate to maximise our opportunities. We are in a healthy financial position with strong cash balances to finance additional organic and acquisitive growth in the UK and continental Europe."