Instinet's CEO Has Had Enough

The top executive at

Instinet

(INET)

is on his way out after a year of contracting profits and rising competition.

President and Chief Executive Douglas Atkin is leaving the company to pursue other business interests, including his board position at ClickIQ. Atkin will be replaced by Mark Nienstedt, who has served as the company's chief financial officer since 1999.

Shares of Instinet have fallen 53% since the company's IPO in May of 2001 at $14.50 a share. They closed Tuesday at $6.83, down 17 cents, or 2.4%.

"They're struggling to find a place in the markets as they now exist, and there's probably a lot of tension over which way to take it," said Raymond James & Associates analyst Antonia Ness. "My big question is whether this signals some big strategic shift. But he's a young guy, it could be that it got less fun, given their struggles. Basically they've been underperforming since they came onto the market."

Chief Operating Officer Kenneth K. Marshall is retiring, but will stay on through the end of this year as a special consultant to the board and Nienstedt. He will be replaced by Jean-Marc Bouhelier, currently executive vice president in charge of Instinet's U.S. Insitutional and Professional Business.

"Mark Nienstedt and Jean-Marc Bouhelier are capable leaders with substantial industry experience," the company wrote in a statement. "With the full backing of the board, they will head ongoing efforts to build Instinet's business and improve the company's profitability."

Instinet, which makes its money by charging commissions for electronically matching buy and sell orders for institutional investors, has been struggling with the stock market decline and falling transaction prices. Recent media reports suggested that parent company

Reuters

(RTRSY)

may be interested in

buying back the 17% of Instinet in public hands.