Spanish carrier Telefónica has named Marc Murtra as its new executive chair over the weekend.

Murtra will replace José María Álvarez-Pallete, who has held the position since 2016.

According to Telefónica, the move has been carried out as part of the company's new shareholding structure. It follows approval given to Saudi Telecom Company's (STC) to complete its acquisition of a 9.9 percent stake in the carrier in November.

The Financial Times reported that the Spanish government, the largest shareholder in Telefónica, played a pivotal role in the leadership change at the telco.

The Spanish government concluded its purchase of a 10 percent stake in Telefónica following STC's initial announcement in September 2023 that it had agreed to acquire a stake. The government's stake was purchased through the state-holding company Sociedad Estatal de Participaciones Industriales (SEPI).

Álvarez-Pallete, who had spent 26 years at Telefónica, was told on Friday (January 17) that he would be ousted from the company, reports the FT, which noted that the company's board met to agree the decision on the following day.

During his tenure at the carrier, shares dropped by around 50 percent, at a time when many European telcos have struggled. The company also lost its position as the biggest telco in Spain last year, as Orange and MásMóvil completed their merger.

Murtra joins the company from Indra, a defense group that specializes in radar systems. Indra is also part-owned by the Spanish state. Murtra was chair at Indra.

He started his career in the nuclear industry, at British Nuclear Fuels Ltd in the UK before he moved to the Management Consultancy DiamondCluster, where he worked for large technological companies.

The FT added that although STC doesn't currently have a seat on Telefónica’s 15-member board, it's expected to push to fill a current vacancy with one of its candidates.

STC previously said it doesn't intend to push for a majority stake in the Spanish telco, when it first announced it had acquired a stake in Telefónica.

When STC announced its initial agreement to purchase the stake, it prompted the Spanish government to heavily scrutinize the deal as STC would become the biggest shareholder in the company, surpassing BBVA, BlackRock, and CaixaBank.

STC is the biggest mobile operator in Saudi Arabia with 20 million subscribers, and has more than 100 million customers globally, with operations in Bahrain, Kuwait, and Malaysia.

The company is 64 percent owned by the sovereign wealth fund of Saudi Arabia, the Public Investment Fund (PIF).