Metcash's long-time chief executive, Andrew Reitzer, will remain as a consultant to the grocery wholesaler for three years after he steps down from the top job next June.
The retailer has also flagged today that Mr Reitzer intends to sell up to half his 1.75 million Metcash shares during "trading windows". At their present value, the shares he plans to sell are worth about $3 million.
After last year signalling his intention to retire, Metcash confirmed today that Mr Reitzer, who turns 59 next week, will step down on June 30 next year, and cease employment with the company three months later.
However, the board will keep him on as a consultant for "strategic advice and assistance in relation to key customer, supplier and joint venture relationships".
Mr Reitzer, who has been chief executive since 1998, would be subject to "appropriate non-compete restrictions" during his three years as a consultant, Metcash said.
It said the consultancy fee would be set on "commercial terms".
Metcash, which supplies independently owned IGA stores and owns Mitre 10, has begun a search for a new chief executive and expects to announce Mr Reitzer's successor next February.
Analysts said Silvestro Morabito, the chief operating officer of Metcash's food and grocery division, had been mentioned as a possible replacement.
"But it is a difficult role to fill as Reitzer has done a good job in a tough environment," one said.
Meanwhile, Metcash has signed a deal with the new owner of Darrell Lea, Queensland pet food manufacturers Tony and Christina Quinn, to stock and promote the well-known confectionary products, which range from household favourite Rocklea Road to liquorices.
The Darrell Lea products will be sold though selected IGA outlets from the end of October.
Shares in Metcash fell 7c to $3.58 in trading this afternoon.