* Peter Clarke to step down in February
* Emmanuel Roman, current COO, to take over
* Departure follows tough times for hedge fund
* Clarke to get one year's salary of $925,000
* Man shares close up 5 percent
By Tommy Wilkes
LONDON, Dec 10 (Reuters) - Peter Clarke, the chief executive officer of embattled hedge fund firm Man Group, bowed to growing shareholder anger over the slow progress of the company's revival plan and will hand over the reins to Emmanuel "Manny" Roman.
Roman, currently chief operating officer and the former boss of GLG, will take over from Clarke in February, Man said in a statement.
The position of Clarke, a 20-year company veteran who has headed the firm since 2007, had become untenable following two terrible years for the company characterised by poor performance and client losses.
Clients pulled money from Man - once the FTSE 100-listed poster child for the hedge fund industry - for a fifth straight quarter, the firm said in October.
Meanwhile its flagship fund AHL, which generates the bulk of the firm's revenues, has remained stuck below its so-called high-water mark, the level above which it can earn lucrative performance fees.
Investors welcomed Clarke's departure with shares closing at 75.5 pence, up 4.96 percent. Since Clarke took over, Man shares have lost 85 percent of their value.
Shareholders will now be looking for signs that the raft of changes already announced - cutting costs, launching new funds and naming Jonathan Sorrell as finance director - is starting to work.
"I think it does go back to a fresh approach. They've got the infrastructure and the cost base of a much bigger firm and Manny should be much more focused on cost savings," said Stuart Duncan, analyst at Peel Hunt.
Jon Aisbitt, Man's chairman, praised Clarke for his role in diversifying Man's businesses and helping to drive down costs.
He said Clarke had led Man through its current changes, but that Roman was the "ideal candidate" to take over.
ROMAN TAKES REINS
Roman, a tough-talking former head of Goldman Sachs' prime brokerage business, joined Man in 2010 after its takeover of hedge fund GLG, where he was co-CEO.
Since then he has gradually increased his power base and was widely touted as a successor to mild-mannered Clarke.
Roman said in Monday's statement he would focus on fund performance, seek to deepen relationships with clients and keep a hold on costs.
In winning over shareholders he will need to show the company can pull in new clients.
Save for a brief upturn during the first six months of last year, Man has been losing assets since the financial crisis just as most big hedge funds have been winning money from pension funds and insurance companies.
Computer fund AHL has also lost ground - it fell 6.8 percent in 2012 and is down 1.2 percent so far this year - to arch-rival Winton Capital in recent years.
Man's other business lines - its fund of funds platform FRM, as well as GLG, which it bought for a controversial $1.6 billion - have so far failed to offset the volatile revenues of AHL.
"This does not change the fundamentals or the challenges the company faces, but it could give them a fresh start with a new CEO that hopefully has a compelling strategy going forward," said Peter Lenardos, an analyst at RBC Capital Markets.
Roman is not without his critics.
"We would be more interested if they got somebody from the outside to come in. I think his people are telling him they don't want to be in a Plc at all," one former shareholder said, reckoning Roman could in future look to take Man private.
ONE YEAR'S PAY
Clarke will retire on Feb. 28 when the company reports its full-year results.
He will receive pay for one year's notice - equating to $925,000. He will not get a bonus for this year.
Although contractually obliged to make the payoff, shareholders are likely to express strong objections to Clarke's 'golden goodbye', seen by some as a step backwards in the fight to stamp out a culture of rewards for failure in UK companies.
At its AGM in May, several of Man's small shareholders voiced frustration at the pay awarded to Clarke in a year marred by share price falls and client exits, with one asking, "Sir, does it really seem like a $7 million sort of year to you?"
"He was behind the GLG deal, which was hugely value destructive. Accordingly, given the rocky time shareholders have endured, I would be staunchly against a large pay-off," said one top-40 investor.