Chairman stepping down at troubled Findel

Findel said Mr Chapman, who joined the Burley-in-Wharfedale company's board in 1984, decided to stand down as executive chairman with immediate effect.

No reason was given for Mr Chapman's sudden departure, but analysts said a change of management was vital for investors to regain confidence in the company.

Shares rose as much as 7.2 per cent in early trading yesterday, eventually closing up two per cent at 24.75p.

"They needed a clean sweep," said an analyst. "Certain investors wanted to see a change of management team."

Findel also parted company with its chief executive Patrick Jolly earlier this year in what was described as a "very amicable" split.

When his departure was announced in December, Findel said Mr Jolly's skills were more appropriate for expansion and less relevant as the company is being run for cash. He was replaced with chief operating officer Philip Maudsley.

Yesterday the group said non-executive director David Sugden has been appointed chairman with immediate effect.

Mr Sugden, who only joined the company in August, said: "Keith Chapman has successfully led Findel for many years and the company is extremely grateful for all his efforts.

"Findel is now one of the leading major groups in home shopping and the distribution of educational and medical supplies. Under his leadership Findel also became the largest manufacturer of greeting cards in Europe prior to the de-merger and subsequent sale of this business to Hallmark in the late 1990s."

Mr Chapman remains among the group's largest shareholders with a stake of more than six per cent. After joining its board, he was appointed group managing director and then chairman and chief executive in January 1988.

He moved the company into education supplies and direct mail. In 1997 the business de-merged, and a year later, its card and stationery business was sold to Hallmark Cards.

Mr Chapman then led the company on the acquisition trail, snapping up a number of internet-based companies during the dotcom boom.

However, when the recession arrived, Findel was hit by a tide of falling sales and bad debts, while owing bank debt of 344.7m. Findel decided to focus on its core home shopping and education supplies arms, while making savings and offloading non-core businesses.

Last year it closed its mail order brands Cotswold Company and Letterbox to cut debt, but about a month later announced a profits warning, sending shares plummeting.

Mr Chapman and Mr Jolly then navigated the group through an 81m equity issue to help to cut its debts.

However, problems continue to dog the company. Last week Findel revealed historical accounting errors in its education supplies division. While they will not hit this year's profitability, they are expected to carve 5m from 2009 pre-tax profits.

"This is about confidence," said an analyst. "Last week did not help. They have set out a series of cost saving measures, much of which is already in place. But there's no real confidence behind the company."

The company declined to comment further and Mr Chapman could not be contacted.

Major steps on path to growth

Findel has its roots in greetings cards manufacturer Fine Art

Developments Ltd, established in 1955.

Fine Art was floated on the Birmingham Stock Exchange in 1962, later moving to the London Stock Exchange.

By the 1990s, Fine Art had expanded into mail order, education

supplies and direct mail. In 1997, the group de-merged into two businesses.

Fine Art Developments focused on mail order and education supplies, while Creative Publishing focused on cards, giftwrap and stationer. In 1998, Creative Publishing plc was acquired by Hallmark Cards.

The group rebranded to Findel in 2000.