After much speculation about his future, chief executive King will step aside at the AGM in July, to be replaced by Mike Coupe, who has been promoted from the role of commercial director.
Under his stewardship, Sainsbury’s has continued to grow its market share despite the emergence of the ‘cheap and cheerful’ grocers such as Aldi and Lidl.
The company’s ‘own branded’ foods have become a hit amid a tough economic climate that has seen plenty of belt-tightening from consumers.
King said: “This was not an easy decision for me to make, and in truth it will never feel like the right time to leave a company like Sainsbury's.
“It has been a privilege to have led the company for the past 10 years and I am incredibly proud of our achievements in that time.”
Coupe, who held senior roles at Asda and Tesco before becoming managing director at Iceland, said it was an “absolute honour” to be appointed the new CEO in the company’s 145th year.
“I very much look forward to building on that success for our customers, colleagues, suppliers and shareholders,” he said.
King’s chosen destination was not revealed, but rumours are circulating in the City about a possible move to struggling retail rival Morrisons (LON:MRW) or even Marks & Spencer, whose boss Marc Bolland has been under pressure lately.
Taking Bolland’s job would be unlikely given the food division’s strong sales performance in recent years. Bolland was hired from Morrisons in 2010 but has failed to turn the ailing clothing division around.
More likely however is a role as Formula One’s chief executive, replacing Bernie Ecclestone.
The 83-year old is said to have turned King down for a job, but accusations of bribery and the resulting legal case prompted him to stand down from the board, and could see investors call for a replacement in King – whose son Jordan happens to be a racing driver.
Sainsbury’s shares dropped 2.4% to 348p on news of King’s departure.