Mr Walls, who has been chairman of Albert Fisher since 1992, said yesterday he would reduce his role to a non-executive position once the disposal of its seafood operation and capital re-structuring were complete.
It has been expected that his role would change since Neil England joined as chief executive last November. But though Albert Fisher said it expected Mr Walls to stay on for some time, it is understood that there are moves within the company to seek a replacement as non-executive chairman.
Mr Walls earned pounds 400,000 in the year ended 1996 but said yesterday that his pay would be "drastically reduced" as he expected to spend only four or five days a month with the company.
The company dismissed suggestions that it was looking for another chairman as "completely unfounded."
It also denied that there had been any deterioration of relations between Mr England and Mr Walls. "You can tell if people don't get on. They get on fine."
It is understood that Albert Fisher received around 40 expressions of interest in its seafood operation which it put up for sale in August after the rebuttal of a bid approach from Chiquita Brands of America.
It has now reduced the number of interested parties to a shortlist and a deal is expected to be announced in December. Analysts say the business is worth around pounds 100m.
The capital re-construction is expected to follow shortly with analysts saying the company could seek authority to buy back up to 20 per cent of its shares.
This could be worth around pounds 60m. Mr Walls said the Chiquita bid approach and adviser fees had cost pounds 1.9m.
He was speaking as Albert Fisher reported flat pre-tax profits before exceptional items of pounds 40m for the past year.
Mr Walls said the strength of sterling had cost the group pounds 3m in lost profits. Net margins improved from 2.9 per cent in 1996 to 3.7 per cent. The dividend was unchanged at 3.75p.
Neil England said that Albert Fisher had been stockpiling prawns to offset the possible impact of a new EU ruling on imports.
He said the EU had banned imports of prawns from India and Bangladesh for reasons of hygiene which had caused prices to rise elsewhere. He said he was hoping for a lifting of the ban but warned that a continuation of the dispute could affect the group's seafood operations if supplies were not built up.
Mr England also warned that food distributors should start increasing their prices for premium fresh produce to offset the possible negative effects of El Nino, the unusual weather system over the Pacific.