The news was not met with approval by the financial markets, though. BT's share price at first rose sharply, only to fall back again in later trading. The shares closed down 30p at 550p. This means that BT will issue new shares and use the money to cuts its staggering debt burden.
Analysts also expect the company to cut the dividend it pays out to shareholders.
Both moves are certain to drive down the value of BT shares. Click here to see the development of BT's share price during the past year. Vallance as 'president emeritus' The surprise announcement came in the morning on BBC Radio 4's Today programme. Sir Iain will step down on 1 May after 12 years in the role and after a 35-year career with the company. He was due to depart in July 2002 and attention will now turn to how long chief executive Sir Peter Bonfield will remain at the helm.