October 9, 2017 / 10:40 AM / a year ago

UPDATE 1-Deutsche Telekom unit T-Systems names Adel Al-Saleh as new head

* Turnaround specialist to take helm at underperforming unit

* Al-Saleh to start job on Jan. 1, 2018, joins Telekom board (Adds background on new T-Systems CEO)

DUESSELDORF, Oct 9 (Reuters) - Deutsche Telekom’s T-Systems technical and communications consulting business said on Monday it has appointed Adel Al-Saleh as its new head, with the American turnaround specialist set to join at a time when the business is grappling with a slide in earnings.

Al-Saleh will also take up a seat on the Deutsche Telekom management board when he joins at the start of 2018. He replaces Reinhard Clemens, who will leave the company after almost 10 years.

Al-Saleh joins from Northgate Information Solutions, where he was brought in by investor KKR in 2011 to conceive and execute a growth strategy across the British service provider’s three main business areas, Deutsche Telekom said.

“Al-Saleh was responsible for the transformation of the NIS Group: he slimmed down the portfolio, gave the group a new strategy and made the business units more efficient and competitive,” the German company said in a statement.

The appointment was first reported by German paper Handelsblatt, which in a separate profile of Deutsche Telekom’s CEO Tim Hoettges speculated on a partial sale of T-Systems that could affect thousands of jobs.

A source close to Deutsche Telekom said Al-Saleh had not been brought on board to break up T-Systems but to lead the business to success.

T-Systems posted a 5.2 percent decline in revenue and a 16 percent drop in order intake in the first half of the year amid sustained industry pricing pressure.

Core profit fell by nearly a quarter in the first half, after a 21 percent drop in the full-year 2016.

“Adel has proved that he can get companies on track,” Hoettges said in the statement, adding that Al-Saleh would familiarise himself with the business before taking full charge at the start of 2018.

Deutsche Telekom’s share price was up 0.1 percent at 15.71 euros at 1035 GMT. (Reporting by Matthias Inverardi; Writing by Victoria Bryan and Douglas Busvine; Editing by Greg Mahlich)

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