In a statement this morning, the company confirmed it had received requests from a group of shareholders, led by Fidelity, that the chairman be replaced, but said that the board regrets they are unable to comply.
In the statement, Sir Brian Pitman, a senior non-executive director, said: "This is not about individuals, this is about the role of a well-respected group of non-executive directors to determine what is in the best interests of a company and its shareholders as a whole.
"We are talking about a management team, which has successfully fought to secure a merger of supreme strategic importance to the UK television industry and which needs every support in order to ensure that merger delivers the benefits we all expect to see."
Green is still haunted by the spectre of ITV Digital's collapse, which resulted in a £1.2bn loss for Carlton and Granada, and has long faced calls from shareholders to stand down. A report in the Sunday Times said that there was an angry meeting between investors and the Carlton board last week, led by Anthony Bolton, a star fund manager at Fidelity.
Over recent weeks, Bolton is known to have approached potential successors to Green and Allen, having built up an 8% stake in Granada and 12% in Carlton, giving him considerable clout.
Bolton is backed by a number of other institutional investors, including UBS Global Asset Management, Morley Fund Management, Legal & General, Isis Asset Management, Deutsche Asset Management and Standard Life Investments, and together they hold 36% of Carlton and 33% of Granada.
Even with the backing of the board, Green's chances of survival look slim. One Carlton non-executive director told the Sunday Times: "If shareholders want to knife Michael, they can. They have more than 35% and would win an extraordinary general meeting. We want a very quick resolution of this."
Bolton is said to have brought forward his plans after Green recently said that he would not retire until he was 80 and planned to work full-time as chairman of ITV.
In the summer, Bolton asked senior media figures for recommendations about who could replace Green and Allen. Some shareholders remain keen to oust Allen as well, but Fidelity recently changed its tactics and decided to target Green alone.
Immediately after the £4bn ITV merger was given the go-ahead by the Department of Trade and Industry, Bolton had a meeting with non-executive directors Sir George Russell and Sir Brian Pitman, who will sit on the ITV board, where he handed them a letter calling for the appointment of "an independent non-executive chairman from outside the enlarged group".
Sir George told the Sunday Times that he and Sir Brian left the meeting "shell-shocked" and added: "This is highly unusual, but shareholders have their rights and we have to listen."
One non-executive director at Carlton told the paper he was furious at being bullied by Bolton: "Presumably Anthony Bolton has decided he is a member of the master race who can make these judgments."
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