Ernest Sharp, chairman of Isosceles, the highly leveraged parent of Gateway, said Mr Willett's departure was because the boards of Gateway and Isosceles were being progressively merged.
Alistair Mitchell-Innes, chief executive of Isosceles, would absorb Mr Willett's responsibilities. Bob Nellist, Isosceles finance director, would become deputy chairman of Gateway.
Internal figures show that Gateway's operating profits for the half-year just ending are about pounds 60m, down from pounds 90m in the same period in 1991. A steady flow of profits is crucial to pay the interest on Isosceles' pounds 1.1bn of debt.
Mr Willett, who was on a three- year contract, is expected to receive compensation for loss of office. He has also resigned his directorship of Isosceles.
Mr Sharp said: 'The logic of the situation was obvious. Bob was very sensible about the whole thing.'
Mr Sharp said the recent spate of bad publicity over Isosceles was because of 'malcontents out to dish us'.
Worries about leaks recently led Geoff Cooper, Gateway finance director, to order the in- house information technology experts to execute a sweep of some phones in the Bristol headquarters to check for bugging devices.
Mr Sharp denied the group was in talks about a further refinancing, following the restructuring completed this month.
He added: 'But you are constantly talking to your bankers. The board is always thinking about the appropriate financial structure for the future.'
According to one source Mr Mitchell-Innes's involvement at operating level may only be a stopgap measure and the group may look for a manager of the stature of Archie Norman, whose appointment at Asda dramatically improved City sentiment about that company.
The board merger also puts a question mark over the need for two finance directors.Reuse content