"Penny has got the company some great publicity in the past year," said an Ultimo rep in an article Wednesday in London's Telegraph. "But we felt we needed someone who has a bigger international profile.
"Penny is a very sexy girl, but isn't known outside England. We will be announcing a very big name replacement for her shortly. We know who we want to front the campaign but the deal hasn't yet been finalized."
Lancaster has modeled for Ultimo, known for its gel-filled bras, throughout the past year.
Rocker Stewart is known for dating young models. Stewart's lengthy list of model loves includes Brit Eckland in the 1970s, Kelly LeBrock, Kelly Emberg, with whom he has one daughter, and, his most recent wife, supermodel Rachel Hunter, with whom he has two children.