London Stock Exchange boss Xavier Rolet has quit immediately amid a row over succession plans for the top job, but will walk away with a potential £13 million golden goodbye.
The move follows a furious spat between the LSE Group and activist investor The Children’s Investment Fund Management (TCI), which accused the group’s chairman of pushing out Mr Rolet after he announced last month he would leave by the end of 2018.
The dramatic move came a day after Bank of England governor Mark Carney took the unusual step of wading into the debate, calling for urgent clarity.
Mark Carney called for urgent clarity (PA)
Mr Carney said he was “mystified” by the tussle and “can’t envisage a circumstance where the CEO stays on beyond the agreed period”.
The LSE said Mr Rolet has been replaced on an interim basis by chief financial officer David Warren, while chairman Donald Brydon said he would not stand for re-election in 2019 to pave the way for a “new team at the helm”.
Mr Rolet hit out at “unwelcome publicity” as he announced his departure.
But he leaves with a mammoth pay-off worth up to £13 million, including a year’s salary and a host of potential bonuses.
Mr Rolet said: “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.
“At the request of the board, I have agreed to step down as CEO with immediate effect.”
Shares in the LSE initially fell 2% after the announcement, but later stood nearly 1% lower.
Mr Rolet will be placed on gardening leave for 12 months, during which time he will be paid his £800,000 a year salary in full.
He is also entitled to an annual bonus worth up to £1.8 million, and shares from a raft of deferred bonuses and long-term incentive schemes worth a possible £10.3 million on top.
TCI, which owns more than 5% of the LSE, had ordered a shareholder vote for the removal of Mr Brydon and to retain Mr Rolet until 2021.
The LSE Group said it “believed, and continues to believe” that the previous plan to hunt for a successor to Mr Rolet for his departure by the end of 2018 was “in the best interests of the company”.
It said it would still hold a shareholder meeting if TCI does not withdraw its request, but Mr Rolet made it clear he would not return to the exchange.
“I will not be returning to the office of CEO or director under any circumstances,” Mr Rolet said.
Mr Rolet’s departure comes after more than eight years in the top job, during which time the LSE has seen its stock market value soar from £800 million to nearly £14 billion.
His tenure has seen LSE seal a string of acquisitions, although it was marred by the recent failed attempt at a £21 billion merger with German rival Deutsche Borse after it was blocked by the European Commission in March.
This was the third attempt at a tie-up between the two companies after setbacks in 2000 and 2005.
TCI did not return requests for comment.