Steadfast Group Ltd (ASX: SDF) shares are under pressure on Tuesday.
In morning trade, the ASX 200 stock is down 1.5% to $4.37.
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Why is this ASX 200 stock falling?
Investors have been hitting the sell button today after the insurance broker network company revealed that its long-serving founder-CEO, Robert Kelly AM, is stepping down.
Mr Kelly co-founded Steadfast in 1996 and led the company's listing on the ASX in August 2013.
It notes that under his stewardship, Steadfast has transformed into Australasia's largest general insurance broker network and group of underwriting agencies and expanded internationally.
According to the release, the leadership transition plan agreed by the board and Mr Kelly follows succession planning discussions which have been underway for some time and are designed to enable a smooth change of leadership.
The ASX 200 stock's chair, Ms Vicki Allen, revealed that its search process for a replacement is progressing. She also advised that the Board has confidence in the capability and experience of Steadfast's executive leadership team. As a result, internal candidates are being considered alongside external candidates as part of a thorough process.
As things stand, the Steadfast board expects to announce the appointment of its new CEO by the release of its FY 2026 results in August.
What's next?
Importantly, this won't necessarily be the end of Robert Kelly AM's involvement with Steadfast.
The release notes that he will remain on the board after his retirement and transition to a non-executive director role.
The ASX 200 stock advised that it feels continuity of industry relationships and an orderly transition is in the interests of all shareholders. Mr Kelly will seek election as a non-executive director at the next annual general meeting.
Commenting on his exit, Robert Kelly AM said:
It has been a privilege to play a leadership role in the creation of Steadfast. I am extremely proud of the achievements of the Company; its strong track record clearly demonstrates the strength of the business model and positions the business to deliver sustainable value to our shareholders for many years to come.
Ms Vicki Allen adds:
In initiating and agreeing this transition plan with the Board, Robert has demonstrated his strong commitment and service to Steadfast. Robert's contribution cannot be understated. His leadership has enabled Steadfast to grow into Australasia's largest general insurance broker network and group of underwriting agencies with a strong track record of growth.
This comes at an unfortunate time for the company, with Steadfast shares recently sinking amid concerns that its business model could be disrupted and ultimately made redundant by artificial intelligence models.
