Gap's CEO Pick Surprises

Murphy, 45, has served as CEO of Shoppers Drug Mart for six years, leading it through 22 consecutive quarters of year-over-year revenue growth -- an appealing record to Gap, which has been battling a 2 1/2-year sales slide.

With more than 20 years of retail experience, Murphy has been credited for reinvigorating retail brands in food, health and beauty, and books. He has held several positions at Loblaw, a leading retail and wholesale food company in Canada. He also served as president and CEO of Chapters, a major Canadian book retailer.

At Shoppers Drug Mart, Murphy grew the company's market capitalization from about C$3 billion to over C$10 billion. Gap has a market capitalization of $13.8 billion.

"Glenn is known for being a decisive leader with great retail instincts who understands his customers," Fisher said in a statement. "He has revitalized major retail brands by offering new products and significantly improving the store experience. He's well qualified to return Gap Inc. to the level of sustained performance we all expect."

Murphy is expected to come on board next week pending receipt of his U.S. work authorization. Fisher will remain on Gap's board of directors.

"I'm thrilled with this opportunity to lead Gap Inc. given the company's iconic stature and heritage of innovation and creativity," Murphy said in a statement. "Alongside some of the most talented people in the apparel industry, we'll work to reestablish each brand's leadership position and set the company along a path of sustained earnings performance."