London Stock Exchange chairman Donald Brydon on Tuesday won shareholder backing to keep his job after an activist investor demanded his removal following the contested departure of CEO Xavier Rolet. Shareholders of the London Stock Exchange Group (LSEG) voted 79 percent in favor of Brydon staying on.
“The Board and I welcome the stability that this gives the Group,” Brydon said in a statement following the result. “The recruitment process for a new CEO is underway and we will update our shareholders in due course.” The vote came after The Children’s Investment Master Fund (TCI) demanded Brydon’s immediate departure, accusing the chairman of having a role in Rolet’s recent departure.
Rolet left his post last month, bringing forward a planned departure after blaming “unwelcome publicity” surrounding talk that he had been forced to step down. Around the same time Brydon, who is accused of forcing Rolet out in a reported boardroom struggle, said he would not put himself forward in 2019 for re-election as chairman. But TCI deemed this insufficient and demanded Brydon step down immediately, leading to Tuesday’s exceptional vote.
Qatar, the largest investor in the LSEG along with US asset manager BlackRock, threw its support behind Brydon before the vote. A source close to the Qatar Investment Authority sovereign fund had told News agents it would support Brydon out of fear that losing both a chief executive and chairman so close together could destabilize the LSEG, which also owns the Milan stock exchange.
That came after the LSEG board backed Brydon unanimously in a letter last month, in which it expressed a “strong preference” for his “invaluable skills and experience”. Qatar and BlackRock each hold about 10 percent of LSEG, while TCI has a five percent stake. Meanwhile, following Rolet’s departure the LSEG appointed its chief financial officer David Warren as interim CEO.
Under Rolet’s stewardship, the company’s market value has rocketed in value, while he oversaw the purchase of US asset manager Russell and the British clearing house LCH.Clearnet. But also on his watch, the LSEG failed to merge with the Toronto stock exchange and Germany’s Deutsche Boerse. The EU in March blocked a proposed blockbuster tie-up of the London and Frankfurt stock markets owing to competition concerns and fallout from Brexit.Do you ever witness anything interesting or exciting? Just take out your phone and send us the exclusive pictures or video and we will pay you cash. E-mail to firstname.lastname@example.org. Please include location, date, involved persons or why it is important and other details.