Gudmundsson is to appoint an executive team to handle the day-to-day running of the club, but Magnusson will continue to be heavily involved and will keep his own stake in the club.

The shake-up is intended to take West Ham to the next stage of their plan to break into the top four in the Premier League, and includes moving to a new stadium.

The club insist the changes will have no impact on manager Alan Curbishley and his coaching staff, who will remain in control of all football matters.

Gudmundsson said: “I am so proud of what we have achieved since becoming involved with the club and I am grateful for Eggert Magnusson’s contribution to West Ham throughout this time.

“Of course there have been challenges but we have made real progress and can be confident about the future.

“It is now vital for our longer-term ambitions to become one of the leading clubs in England playing for honours both at home and in Europe that we strengthen the senior team at the club and build a truly professional management structure for the future.”

Magnusson said the time was right to “stand back a little”.

He said: “We have worked hard to create stability and optimism sometimes in very difficult and trying circumstances. I think it is now important to broaden the management team so that we can deliver the bright future that is opening up for the club.

“I have enjoyed my time as executive chairman but feel the moment is right to stand back a little as we move into a new and exciting period.”

Gudmundsson will remain chairman of the board of West Ham United Holding, with his close aide Thor Kristjansson as both vice-chairman of the holding company and executive vice-chairman of the club.

Scott Duxbury remains chief executive and an expanded executive team will be announced in the near future.

It is thought that Mike Lee, the former communications chief of the Premier League, UEFA and the London 2012 Olympic bid, may be in line for a director’s role after advising Magnusson on PR strategy over the last year.