SGI Chief Heading to Microsoft

Silicon Graphics Inc. Chairman and Chief Executive Officer Richard Belluzzo has quit his post and is expected to take the reigns of Microsoft Corp.’s Internet operation.

Microsoft would not confirm the report, although SGI told The Wall Street Journal he was leaving to take a “non-CEO” position at another company.

Belluzzo was hired 19 months ago from Hewlett-Packard Co. to help the company expand its product line. SGI was planning to launch a new line of computers that would use Intel Corp. microprocessors and Microsoft Corp. software. However, that decision was in effect reversed on Aug. 10 when SGI announced a restructuring and plans to lay off up to 17 percent of its 9,000-member work force.

Belluzzo is expected to begin his new position around Sept. 1.

The appointment comes as Microsoft is considering to issue a tracking stock that would follow the value of its Internet holdings. Although sources told the Journal those plans have been temporarily shelved, Microsoft may be considering a spin-off or sale of some of its Internet operations.

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