(FILES) This file photo taken on May 17, 2017 shows Carsten Kengeter, CEO of German stocks operator Deutsche Boerse, addressing shareholders during the company's annual general meeting in Frankfurt am Main, western Germany. Deutsche Boerse announced on October 26, 2017 that Carsten Kengeter is leaving the stocks operator. / AFP PHOTO / Daniel ROLAND
FRANKFURT: Deutsche Boerse’s embattled chief executive Carsten Kengeter is stepping down amid continuing allegations of insider trading, the German exchange operator announced on Thursday, hours before the company issued a profit warning.
Deutsche Boerse’s supervisory board accepted Kengeter’s offer to resign at an extraordinary meeting on Thursday. No successor was named, and Kengeter will stay on until there’s a transition plan.
Deutsche Boerse said that the resignation was ”in order to allow the company to focus its energy back onto clients, business and growth and to avoid further burdens caused by the ongoing investigation”.
Late on Thursday, Deutsche Boerse warned that profit for 2017 was ”very likely” to fall short of its target for an increase of between 10% and 15%.
It cited ”prevailing negative cyclical effects”, like low volatility, as the main obstacle.
It said it was on target for its 2018 and 2019 goal for annual earnings growth of 10%-15%.
Kengeter and Deutsche Boerse have been dogged by an insider trading investigation since early this year.
The probe stems from shares Kengeter bought in December 2015, just months before formal merger talks with London Stock Exchange were announced.
The shares soared and investigators have been looking into whether Kengeter was already in merger talks before he bought his shares. The merger eventually failed.
Kengeter and Deutsche Boerse have denied wrongdoing.
Kengeter’s position became more tenuous earlier this week when a Frankfurt court ruled against a settlement that would have helped him and Deutsche Boerse put the case behind them.
The resignation means two top exchanges will be seeking new chiefs. Last week, Xavier Rolet, chief executive of the London Stock Exchange Group, said he would step down at the end of next year.
Deutsche Boerse and LSE, which had sought to merge, are now competing for market share in the run-up to Britain’s exit from the European Union. - Reuters
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