SAN FRANCISCO — The board of directors at Microsoft is preparing to tap Satya Nadella as CEO Steve Ballmer's successor and is holding discussions to replace Chairman Bill Gates, according to a report.
A candidate to replace Gates as chairman, John Thomson, the software giant's lead independent director, has emerged as well, according to Bloomberg News, citing people briefed on the process.
USA TODAY could not independently confirm the decision. Microsoft did not immediately respond to a request for comment.
As of Thursday night, Microsoft's board was meeting. An announcement was expected as soon as Friday. Microsoft shares were up 1%, to $37.20, in after-hours trading.
Should Ballmer and Gates depart, the software giant would be without its two most recognizable figures for the first time in its 39-year history.
The report said that Nadella jumped forward as the front-runner in recent weeks as Ballmer's replacement. However, the plans aren't finalized, according to the report.
Nadella, who joined Microsoft in 1992, is in charge of the company's enterprise and cloud businesses.
When Microsoft filed its last annual proxy in October, it reported Nadella received compensation valued at about $7.6 million for the 2013 fiscal year, including $669,167 in salary, a $1.58 million bonus and a $5.4 million stock award. He gained another $4.9 million from previously awarded shares that vested.
Microsoft also said Nadella held another 454,000 shares, worth $15.6 million, that had not yet vested.
It's likely that Nadella would receive a large salary increase and sizable stock award if he's named CEO. When Apple's Tim Cook was named CEO, he received a restricted stock award then valued at about $376 million.
Microsoft has been searching for a new chief since Ballmer announced he was stepping down in August amid grumblings about Microsoft's strategy and its direction the past few years.
Among the candidates floated as successors to Ballmer have been Microsoft Executive Vice President Tony Bates and Chief Operating Officer Kevin Turner. Several outsiders emerged, too, including former Nokia CEO Stephen Elop, Ford Motor CEO Alan Mulally and Qualcomm CEO-elect Steve Mollenkopf.
But Mulally took himself out of the running this month.
Thompson, who led the CEO search, wrote in a blog post last month that the board started with more than 100 candidates.
"If you were going to pick somebody who is an established Microsoft veteran, Nadella is the guy," says reDesign analyst Rocky Agrawal, a former Microsoft employee. "He seems like the best bet. I would have been really disappointed if they had picked Stephen Elop given what happened with Nokia."
Contributing: Gary Strauss
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