Tabcorp said its board considered the language used by the CEO to be inconsistent with his leadership and following discussions, Rytenskild stepped down immediately, according to the company.

The outgoing CEO, however, said he does not recall making the alleged comment, according to a statement from the company.

"It's not language I would usually use, but I have regrettably agreed to resign," Rytenskild said.

It is not clear whether Rytenskild used inappropriate language in only one instance. The company did not immediately respond to Reuters' request for further details.

Rytenskild will receive only the termination payments required by law and under his contract and will forfeit all his unvested short-term incentive and long-term incentive awards, the racing and wagering giant said.

Rytenskild was appointed CEO in June 2022 and has served with the wagering firm for over two decades.

"Tabcorp has been an enormous part of my life for many years and I believe in the journey the company is on," Rytenskild said in the statement.

Chairman Bruce Akhurst will take over the additional role of executive chairman till the firm finds a permanent replacement for Rytenskild.

"The Board regrets that Mr Rytenskild's employment has ended in this way and acknowledges his commitment to Tabcorp's growth over more than two decades, including the last two years as MD & CEO." Akhurst said.

The board has appointed Maritana Partners to commence a global search for a new managing director and CEO.

Tabcorp shares ended the day 2.6% lower at A$0.765 apiece.

(Reporting by Rishav Chatterjee in Bengaluru; Editing by Sonia Cheema)