The board of Babcock & Brown, the Australian investment group, bowed to investor pressure by overhauling its senior management on Thursday, sacking a quarter of its staff and promising to shun opportunistic deals.

Phil Green, chief executive, and Jim Babcock, executive chairman, agreed to step down from their positions after the ailing Australian investment group said first-half net profit fell 34 per cent to A$211.08m ($185.30m), in line with a recent profit warning.