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Nadella takes over as CEO immediately (Photo: Microsoft)

Satya Nadella, executive vice president of Microsoft's cloud and enterprise division, will succeed Steve Ballmer as CEO of the US-based software group effective immediately.

“During this time of transformation, there is no better person to lead Microsoft than Satya Nadella,” said Microsoft founder  Bill Gates. He said Nadella brings to the top job the kind of vision the company will need to expand product innovation and growth.

Nadella joined Microsoft in 1992 and was instrumental in moving the company's focus to cloud-based services. In a press release, he reaffirmed his commitment to continued change. “The opportunity ahead for Microsoft is vast, but to seize it, we must focus clearly, move faster and continue to transform," he said. "A big part of my job is to accelerate our ability to bring innovative products to our customers more quickly.”

As Nadella assumes the CEO position, Microsoft announced that Gates will cede his position as chairman of the board to John Thompson, the lead independent director on the board. Gates will assume a new role on the board as "founder and technology adviser," Microsoft said.