Greener forced out at BAT

Black Friday in the boardroom: Shake-up at the retailer, darkening clouds over Italian airline, and a surprising departure at the conglomerate

BAT lost the highly regarded head of its financial services division yesterday, just two days after the tobacco-to-insurance group announced an overhaul of the Eagle Star and Allied Dunbar operations he had run for the past four years.

A terse statement said George Greener had resigned "by mutual consent" although a company source confirmed that the impetus for the abrupt departure of the 50-year-old main board director had come from the company. Mr Greener is understood not to have another job to go to.

Negotiations regarding his severance pay continue but BAT is thought unlikely to honour the whole of a two-year rolling contract, which saw Mr Greener take home a basic salary of pounds 550,000 in 1994 even before a bonus of pounds 138,000. A compromise payment of about one year's salary is thought likely.

Mr Greener's arrival at BAT in 1991 after 20 years with Mars was greeted with much fanfare and high hopes that his consumer goods marketing expertise could be used to good effect in the group's financial services operations.

Analysts were yesterday baffled by the style of his departure, not least because he had seemed to be a strong proponent of the company's stated strategy of creating greater coherence between Eagle Star's and Allied Dunbar's life and general insurance operations. He had also been instrumental in setting up Threadneedle, BAT's asset management division.

Mr Greener is replaced by Sandy Leitch, currently head of Allied Dunbar. Steve Melcher, chief executive of Eagle Star's EU business, takes the same position at Allied Dunbar, retaining responsibility for Eagle Star's life operations. Clive Coates, Eagle Star's finance director, steps up to head its general insurance business.

Earlier this week Martin Broughton, BAT's chief executive, heralded a shake-up of the financial services arm and warned of job losses. The life insurance sector has been under pressure to cut costs against flat or falling sales. Allied Dunbar's contribution to group profits fell by more than a quarter last year.