Penney initially signed a two year contract when he was appointed at the start of the 2012/13 season and had the option of a third year, but Munster revealed that the 49 year old has attracted the interest of another club, believed to be in Japan.
Munster and Ireland lock Paul O'Connell has revealed that the club wanted Penney to stay for another year but that the coach had to do what was right for him and his family.
"I am disappointed to be leaving Munster as I have thoroughly enjoyed my time here," said Penney.
province sits on top of the Pro12 table while they also finished first in their Heineken Cup pool, earning them a home quarter final against Toulouse in April.
"We now need to focus on the remainder of this season and the opportunities ahead in both the Heineken Cup and the RaboDirect PRO12. We are confident both Simon and Rob will continue to strive for success and guide the squad through to the next stage."
'Positive influence'Munster have been in impressive form under Penney this season, winning 15 of their 18 games, and remain on course for a domestic and European trophy double.
"I would also like to take this opportunity to thank Simon for his work and commitment to the province, and we wish him all the best for the future. He has contributed to Munster's overall campaign and added great value to our coaching team.
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The Kiwi duo are out of contract this summer and Puma Shoes Orange Black
Munster head coach Rob Penney to leave at the end of season
Munster Rugby chief executive Garrett Fitzgerald said, "When we reach the end of Puma White And Gold Sneakers the season Rob will leave with our thanks and best wishes for the future.
presented to me and prioritise my family and personal circumstances at this time.
Munster head coach Rob Penney and backs coach Simon Mannix will leave the province at the end of the season.
"We still have a few months to go and the goals remain the same I want to achieve success with this great group of lads!"
"In developing the squad he has highlighted the strength and depth of the Munster panel, with the competition for places as high as ever.
"I have to take this opportunity Puma Sneakers Pics
"Rob has been a very positive influence on this Munster squad and management and we are disappointed to see him go as we had hoped that he would fulfil his third season.
"Rob has been a very positive influence on this Munster squad and management and we are disappointed to see him go as we had hoped that he would fulfil his third season."
have opted against renewing their deals with the Irish province.
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