BT is to form a £400m IT services business that will see the integration of three standalone units, reseller Engage IT, BT Business Direct and e-tail arm dabs.com, with Engage IT head Martin Balaam to step down as a result.
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"The new entity will deliver IT services to the entire spectrum of BT Business customers. It will allow BT Retail to work more effectively as one team across its customer base and across the different businesses," said BT in a statement seen by MicroScope.
"As well as continuing to grow revenues, it will also bring benefits in many other ways, such as making the most of BT Retail's purchasing power and providing better utilisation of assets and skills between the businesses.
The new business will have sales of £400m, according to BT, which bought dabs.com in 2006 and formed Engage IT a little over two years ago from the marriage of its Basilica and Lynx units.
The telco added: "The Engage IT board will report direct to John Thornhill with effect from 1 September. Martin Balaam will work with John over the next few weeks on the handover. Martin's next steps will be announced in due course."
However, one former BT Engage IT employee with 30 years service told MicroScope's sister publication, ComputerWeekly.com, that there may be more to Balaam's departure than BT has said.
Although the firm has recently trumpeted its growth ambitions, the whistleblower took a different view, saying: "He [Balaam] got rid of the old guard and the business struggled. Over 100 people have left."
Just this week former BT Engage IT sales director Gary Butters headed for network, hosting and services provider Easynet Global Services to head up its UK sales and marketing activities.
Balaam joined BT Engage IT in 2009 to replace Nick Gorringe after a troubled stint in charge of comms and networking services provider Redstone.
Reporting by Cliff Saran and Alex Scroxton. A version of this story also appears on ComputerWeekly.com