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9 November 2017, 20:36
An activist investor campaigning for the boss of the London Stock Exchange Group (LSE) to extend his tenure has launched a move to oust the company's chairman.
The Children's Investment Fund (TCI) has written to the LSE's board to requisition an extraordinary general meeting aimed at removing Donald Brydon, confirming a story first reported by Sky News.
TCI also said in its letter that it wanted the company to end its search for a new chief executive to replace current boss Xavier Rolet - whose planned departure by the end of next year was announced last month.
The hedge fund wants, if Mr Rolet accepts, for his tenure to be extended to 2021.
It is the latest development in a situation rapidly developing into one of the City's most spectacular bust-ups for years.
The LSE group declined to comment.
TCI, which owns 5% of the company, is one of its most influential and long-standing shareholders, and an ardent supporter of Mr Rolet.
Last week, it wrote to Mr Brydon, alleging that he had forced Mr Rolet to announce last month that he would retire by the end of next year.
Sir Chris Hohn, who runs TCI, said he had received "no satisfactory answer" from Mr Brydon about the reasons for Mr Rolet's removal during a meeting earlier in the week.
"We seek your resignation and ask the board to immediately begin the search for a new chairman," his letter added.
The hedge fund boss wrote to Mr Brydon again this week, urging him to waive a confidentiality agreement relating to the circumstances of Mr Rolet's resignation.
TCI has spent the last few days discussing the situation with other LSE shareholders, and believes it is gathering significant support for its conviction that Mr Brydon should step down.
The LSE said in response to TCI's original letter that it had "followed a proper governance process to plan an orderly succession for the CEO".
It added: "The FCA [Financial Conduct Authority] was kept informed throughout the process and emphasised the importance of the plan for an orderly succession.
"Xavier 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."
The FCA is understood to have expressed concerns about the escalating situation given the LSE's vital role in the City's financial markets infrastructure.
The boardroom row has come as a particular shock to the City both because of the mutually respectful tone struck in a statement on October 19 about Mr Rolet's intention to step down, and because of the stellar job he has done during his near-decade at the company.
He had planned to retire in any case if a merger between the LSE and Germany's Deutsche Boerse - which was ultimately blocked by regulators - had been completed.
(c) Sky News 2017: London Stock Exchange investor moves to oust chairman