BT Group CEO Verwaayen to Step Down Next Month

LONDON -(Dow Jones)- BT Group PLC Tuesday said Chief Executive Ben Verwaayen is stepping down and will be succeeded by Ian Livingston, who currently heads the telecom company's retail business.

After more than six years at the helm of the company, Verwaayen will step down as chief executive May 31 and will leave the board June 30.

"It's a good thing to do after six years," Verwaayen said later Tuesday in an interview with business news TV channel CNBC.

A BT spokeswoman declined to comment on Verwaayen's plans after he leaves the company.

Dutch-born Verwaayen joined BT in January 2002 from Lucent Technologies, now part of Alcatel-Lucent where he was vice-chairman of the management board.

He then began a transformation of the UK's former telecommunications monopoly, leading its expansion into broadband and boosting the operations of BT Global Services, which provides networked IT services to businesses.

But in February BT shares fell 8% after the company posted a 1% fall in third-quarter net profit and missed revenue targets as competition in the broadband market took its toll.

Livingston, who joined BT as group finance director in 2002 and took over as chief executive of BT Retail in 2005, will succeed Verwaayen as chief executive of the group June 1.

"The board has been involved in the process of transition for many months to ensure an orderly succession," BT Chairman Mike Rake said in a statement.

Nomura analyst Martin Mabbutt, who has a buy recommendation on the stock, said the move isn't entirely a surprise, since there had been rumors about a possible management changeover, but noted that it happened a bit earlier than expected.

"Livingston will not be seen as someone who will undertake major changes like Verwaayen, but it's a safe pair of hands with a deep knowledge of the business," Mabbutt said.

Livingston's current role will be filled by Gavin Patterson, who is now group managing director of BT's consumer unit.

BT shares, which have lost around 26% of their value in the last 12 months, were trading up 2 pence, or 0.9%, at 232 pence at 0807 GMT, in a lower London market.

At the same time, the DJ Stoxx 600 Telecommunications index was down 1%.

-By Elena Berton, Dow Jones Newswires; 44 20 7842 9267; elena.berton@dowjones.com

(END) Dow Jones Newswires

Posted to the site on 8th April 2008