IBM's (IBM +0.90%) spinoff took a huge step forward today. The company tapped Martin Schroeter to serve as the CEO of the company now known as "NewCo."
Effective Jan. 15, Schroeter will head what is now IBM's managed infrastructure services business. The company expects the spinoff of that enterprise to occur by the end of this year.
CEO Arvind Krishna, who first announced the spinoff in October, praised Schroeter's leadership skills and qualifications: "Martin has the strategic vision and business judgment to realize NewCo's enormous potential as the global leader in managed infrastructure services. He is an inspiring, results-driven executive and the right CEO to lead NewCo through the spinoff process and beyond."
Schroeter most recently served as IBM's senior vice president for global markets, where he oversaw global sales. He also managed the company's marketing and communication functions and helped to build IBM's brand reputation across the globe.
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He may need these skills to turn around this managed infrastructure business. Schroeter takes over an enterprise that has not prospered under the IBM umbrella recently.
In the most recent quarter, revenue in the global technology services division fell by 4%. It had also declined in the first three quarters of 2020.
Still, with the spinoff, NewCo gets a second chance as a company focused exclusively on this legacy enterprise. IBM expects the business will drive $19 billion in annual revenue as it works through a $60 billion services backlog.
"NewCo is a trusted partner to the world's most global enterprises with a team that has the best skills and experience in the industry," Schroeter said. "I look forward to developing a diverse ecosystem of partnerships and alliances, to continuing a deep relationship with IBM, and to the creation of market-leading capabilities."
