Lululemon needs a new CEO, and analysts say there's a clear frontrunner for the job (LULU)

conduct.
It is now searching for a replacement CEO but will be run by three members of senior management during the interim period.
Analysts say industry veteran Stefan Larsson is the frontrunner for the job.

Lululemon is hiring.

This week, the athletics apparel company lost its CEO after Laurent Potdevin abruptly resigned. The company released a statement that suggested Potdevin had engaged in poor conduct but did not specify how exactly, sending the industry into a frenzy. Sources close to the situation later confirmed that Potdevin's relationship with a former employee was one contributing factor of several.

Now everyone's wondering: who will replace him?

"In our view, the lead candidate is Stefan Larsson, the former CEO of Ralph Lauren," Canaccord Genuity wrote in a note to investors on Tuesday.

Larsson, who, in addition to roles as CEO at Ralph Lauren and as global president of Old Navy, spent a decade and a half at H&M, is poised to become the new CEO, analysts say. Larsson left Ralph Lauren in February 2017 after less that two years at the company, and since then he has been tied up in a non-compete agreement that expires in May 2018.

He did not immediately respond to Business Insider's request for comment, and a spokesperson for Lululemon declined to comment on the speculation.

Larsson has a history of resuscitating brands — he's been credited with H&M's rapid expansion in the US and for rescuing Old Navy.

Old Navy had become a victim of H&M's success, which was leading the way in fast-fashion retail. Gap Inc.'s CEO at the time, Glen Murphy, hired Larsson in 2012 to turn the business around. Murphy is now the executive chairman of Lululemon and is expected to have a leading role in the hiring of its new CEO.

He clearly has a great appreciation for Larsson: "

Larsson completely overhauled Old Navy's business, cutting the supply chain and hiring talent from Coach, Nike, and Reebok to make the clothes more fashionable.

"Using what he learned at H&M, he did a better job of matching supply and demand," Bridget Weishaar, a retail analyst at Morningstar, told The New York Times in 2015. "He realized that people who were buying cheap clothes still wanted to look good."

Old Navy has become its parent company's saving grace. While Gap Inc. has struggled in recent years,

Three years later, Larsson was called in to help Ralph Lauren with its turnaround efforts, and he took over from the longtime CEO and founder of the business, Ralph Lauren himself.

But his proposals didn't sit well with Lauren, and the two leaders disagreed on the creative direction of the company. Larsson left after one and a half years with a reported

stronger-than-expected holiday sales in January and subsequently increased its top-end estimate for net revenue in the fourth quarter by $30 million, from $885 million to $915 million.

But it needs a leader.

Lululemon needs a new CEO, and analysts say there's a clear frontrunner for the job (LULU)

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