BT Group plc’s (LON:BT.A) chief executive Gavin Patterson is to step down later this year.
The telecoms giant gave no fixed date for his departure, stating only that the 50-year-old will leave when a successor is ready to take over, expected to be in the second half of the year.
WATCH: BT dividend under threat as CEO Patterson steps aside
“Gavin has been with BT for just over 14 years and I want to thank him for his contribution to our business during that time, in particular during the almost five years that he has served as chief executive,” said chairman Jan du Plessis.
“The board is fully supportive of the strategy recently set out by Gavin and his team. The broader reaction to our recent results announcement has though demonstrated to Gavin and me that there is a need for a change of leadership to deliver this strategy.”
Since taking the job back in the autumn of 2013, Patterson has been investing in building up BT’s mobile and TV businesses.
It snapped up mobile operator EE for £12.5bn back in January 2016, while BT has spent billions of pounds acquiring various sports rights for its BT Sport TV channel which launched around the same Patterson joined.
Disastrous 18 months
Under Patterson’s leadership, though, the FTSE 100 group has stumbled from one issue to another over the past 18 months or so, during which time its share price has almost halved.
The accounting scandal in its Italian division last January rocked the market, while BT has more recently had to plough billions into its pension pot and cut thousands of jobs to prop up the bottom line.
It has also had to manage an increasingly difficult relationship with regulator Ofcom.
In spite of overseeing a horrible year for BT, the company revealed Patterson was paid £2.3mln last year, including a £1.3mln bonus and a 1.5% rise in his basic salary.
Some of BT’s top investors were said to have met with chairman Jan du Plessis earlier this week to express their dissatisfaction with Patterson’s performance.
Addressing his departure, Patterson said it had been an "honour" to lead BT for the past five years.
“BT is a great business and with the new management team I've recently put in place, is I believe very well positioned to thrive in the future.”
‘More wrong than right’
“There's a been more wrong than right for BT since he took over five year ago. It's been a disappointing time for BT and for its shareholders,” said Markets.com analyst Neil Wilson.
“The expensive move into football rights was a mistake and evidence that management lacked focus under Patterson. Similarly, the EE acquisition was expensive but hasn't worked out as planned.”
“Patterson also presided over an accounting scandal at the Italian division that really rattled shareholders… [while] there was also that record fine from the regulator. And the pension deficit - a black hole of £11.3bn.”
He added: “But with his troubled reign over and the restructuring dirty work announced, investors can look to the future.”
BT shares were broadly flat in early deals at 203.2p.
--Updates for share price and analyst comment--