Sir Ian Prosser was not a popular choice

The former head of Bass was due to replace Sir Peter Davis in the role from July 2005.

But since the appointment was announced last week, shareholders have made clear their opposition to the move.

Given the reaction to his appointment, Sir Ian had decided to withdraw from the position, Sainsbury's said.

"The board of J Sainsbury plc and Sir Ian Prosser have each considered carefully the reaction of certain institutional shareholders consulted on the appointment of Sir Ian Prosser as deputy chairman and chairman designate," the company said in a statement.

"As a result, Sir Ian has concluded that it would not be in the best interests of the company to proceed and has consequently decided to withdraw."

Pressure

Shares in Sainsbury's rose, closing 2% higher at 294.5p.

Sir Ian's appointment as deputy chairman and chairman designate was announced a week ago.

But since his appointment was unveiled, there have been reports that institutional shareholders were unhappy with the move.

Investors were said to be unconvinced that he was the best person to help turn round Sainsbury's, which is losing ground to its rivals.

Some shareholders were also reported to be wary of his performance at Bass - which became hotels and brewing firm Six Continents before demerging last year.

Some said Sir Ian's management style there did not involve enough consultation of shareholders or taking account of their concerns.

And Sainsbury's board came in for criticism, with major shareholders complaining they had not been consulted before Sir Ian's appointment.

It is the second time Sir Ian has stood aside from a chairmanship. In 2002, he withdrew as potential chairman at Standard Chartered.

Change at the top

Sainsbury's had been making boardroom changes to create a team to lead the firm following the departure of current chief executive Sir Peter Davis.

Last year, Sainsbury's announced that Justin King, the head of Marks & Spencer's food business, would replace Sir Peter next month.

Sir Peter will then become chairman and had been due to be replaced by Sir Ian Prosser in 2005.