The original Sugababes have been accused of firing Howard, the 'Overload' co-writer who got them to reform, although a rep for the band insisted it was a "mutual" decision.
"The girls got rid of him - there's no two ways about it. They didn't think things were working out and wanted to get a new manager. Everyone was really shocked," a source told the Sunday Mirror.
"Felix knows how to manage a band and is a good guy for the job. But they wouldn't have it and thought best to get a new manager before they started releasing the new music. There's no bad blood."
Another source added: "They were looking for a manager to co-manage with Felix but it seemed better to find one rather than two."
Mutya Keisha Siobhan, who are signed to Polydor Records, recently finished work on their new album and are said to be choosing between three tracks as the lead single.
Emeli Sandé, Naughty Boy, ex-All Saints singer Shaznay Lewis and MNEK have all worked on the project.
Watch the video for 'Overload' below: