London Stock Exchange Group PLC (LON:LSE) said it has followed the “proper governance process” for the succession of chief executive Xavier Rolet after a major shareholder claimed he was being forced out by chairman Donald Bryon.
TCI Fund Management, which owns more than 5% of the stock exchange, said in a letter that it wants Rolet’s contract to be extended until 2021 and asked the LSE to suspend the search for a new chief executive immediately.
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The fund, run by activist investor Sir Christopher Hohn, said it will call an extraordinary general meeting asking Bryon to resign if the board does not keep Rolet as chief executive.
Rolet announced in October that he was stepping down by the end of December 2018 but has not publicly stated his reasons for leaving.
Hohn claimed that Rolet is leaving the LSE against his wishes and argued that the chief executive created value for shareholders, having overseen a recovery in the company’s share price.
The share price has risen from below £10 when Rolet joined in May 2009 to the £40 mark for the first time earlier this year.
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In a statement on Monday, the stock exchange said it had received the letter from TCI.
“LSE has followed a proper governance process to plan an orderly succession for the CEO. The FCA (Financial Conduct Authority) was kept informed throughout the process and emphasised the importance of the plan for an orderly succession,” it said.
“Rolet will be providing input into the process to identify his successor and is focussed on his role as CEO until his successor is appointed.”
Rolet’s resignation comes at a challenging time for the LSE as it faces a potential impact from Brexit while trying to compete against other world stock exchanges to attract Saudi Aramco as the Saudi Arabia oil company’s plans to list.