London Stock Exchange Group PLC (LON:LSE) chairman Donald Brydon has decided to stand down in 2019 after a shareholder called for his resignation over the ousting of chief executive Xavier Rolet.
The company said Rolet will no longer stay on until December 2018 as previously announced and will instead leave with immediate effect at the board’s request.
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"Since the announcement of my future departure on 19 October, there has been a great deal of unwelcome publicity, which has not been helpful to the company,” Rolet said.
“At the request of the board, I have agreed to step down as CEO with immediate effect. I will not be returning to the office of CEO or director under any circumstances. I am proud of what we have achieved during the past eight and a half years."
The announcement comes a day after Bank of England Governor Mark Carney called for clarity over the dispute over Rolet’s resignation.
Hedge fund manager Sir Chris Holn, whose The Children's Investment (TCI) fund owns 5% of the LSE, last week urged the BoE to step in and remove Brydon. Holn claimed the chairman has forced out Rolet against his will and that he should stay because he has driven value creation at the LSE.
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Now it seems the LSE has bowed into pressure by saying that Brydon will not stand for re-election at the annual general meeting in 2019. The group said Brydon and the board “believe that at that point it would be in shareholders' interests to have a new team at the helm to steer the future progress of the company”.
Brydon said: “The board is confident LSEG will continue to prosper with David Warren as Interim CEO and the existing strong management team. They have deep knowledge of LSEG's business and helped shape, lead and execute its strategies. They are already working towards LSEG's current three year financial targets. I look forward to working with David and his team. We acknowledge, as I said last month, Xavier's immense - indeed transformative - contribution to the business."
The LSE said it continues to believe the decision to find a new chief executive is in the best interests of the company.
It has asked the TCI to withdraw its request, submitted in early November, for an emergency general meeting calling for the resignation of Brydon and to end the search for a new chief executive.
“If TCI does not withdraw its requisition in full, the board intends to publish a shareholder circular confirming among other things the date of the general meeting at which the proposed resolution or resolutions will be put. The circular would be published no later than 30 November 2017,” the LSE said.
The LSE had until Thursday to publish a circular in response to a demand by TCI for a general meeting over the issue.