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BT Group chief executive Philip Jansen is preparing to step down next year, prompting the telecoms company to begin a search for his successor, according to two people familiar with the matter.
The FTSE 100 constituent could provide more details of its succession planning as soon as its annual meeting of shareholders on Thursday.
“As normal course of business, the BT board undertakes regular succession planning to ensure it is preparing appropriately for the future,” the company said in a statement on Sunday.
Sky News first reported that Jansen had signalled to BT’s board that he would probably step down in 2024.
Succession planning for Jansen comes as the UK telecoms group embarks on its most radical cost-cutting since it was privatised in the 1980s. Under Jansen’s leadership, BT has set out plans to cut 42 per cent of its jobs by the end of the decade. He envisaged that BT could benefit from artificial intelligence and digitisation to save money.
Meanwhile, Patrick Drahi’s Altice increased its shareholding in BT to almost 25 per cent in May. However, the Franco-Israeli billionaire’s telecoms investment group said at the time that it had no plans to make an offer for BT.
Any foreign takeover of the former monopoly would be likely to attract scrutiny from the UK government, which last year examined the security implications of Altice’s stake and determined no intervention was needed.
Jansen has previously told investors that BT was “positioned for future growth” and able to “take advantage of new opportunities”, despite “painful” expenditure on infrastructure upgrades and successive quarters of decreased cash reserves.
The group’s closely watched “free cash flow” totalled £1.3bn in the 12 months to the end of March, putting it at the lower end of the range it had set out to investors. BT has said the figure is set to fall to between £1bn and £1.2bn in the current financial year.
Its annual adjusted earnings before interest, tax, depreciation and amortisation increased by 5 per cent to £7.9bn, though full-year revenues fell 1 per cent to £20.7bn.
Jansen was chief executive of Worldpay until he joined BT in February 2019, having led the payments company during its initial public offering in 2015. BT paid him about £3mn in its most recent financial year.
BT shares are down more than 35 per cent over the past year.
Deutsche Telekom chief executive Tim Höttges has said his “biggest mistake” was accepting BT shares in exchange for the German company’s shares in EE in 2015. The group holds a 12 per cent stake in BT.