Morgan Stanley said Monday that chief executive Philip Purcell is leaving the Wall Street giant in the face of a fierce campaign from dissident shareholders and executives. The investment bank and brokerage company said Purcell will leave no later than March 2006, the date of the next annual meeting.
In a letter released by Morgan Stanley, Purcell wrote: "It has become clear that in light of the continuing personal attacks on me, and the unprecedented level of negative attention our firm - and each of you - has had to endure, that this is the best thing I can do for you, our clients and our shareholders."
He added, "I will retire when my successor is appointed."
Morgan Stanley shares rose 2.7 percent to 51.22 in morning trade.
The search for a replacement is underway will be led internally by Charles Knight, the chief of Morgan Stanley's compensation committee. Knight said he would not consider John Mack, former Morgan executive and former chief executive of Credit Suisse First Boston. Mack announced last week he was joining a hedge fund.
Knight also said Morgan Stanley will not consider anyone aligned with a group of eight former executives who have challenged Purcell publicly and called for his resignation since March.
Peter Cardillo, chief market analyst and strategist at SW Bach, said before the bank had confirmed Purcell's departure that: "Obviously, if the story comes to fruition, the stock will move higher."
He said, "People in the market would view it as a positive. It would indicate that people are viewing the departure as a good thing."
Purcell has been waging a high-profile battle with a group of dissident investors and former executives unhappy with the firm's performance.
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