Microsoft COO Turner leaving for a hedge-fund post

Kevin Turner, chief operating officer of Microsoft, is leaving the company to lead a unit of Citadel, the Chicago-based investment firm.

Turner, an 11-year Microsoft veteran, oversaw the company’s biggest unit, directing about 51,000 employees and an umbrella organization for sales, marketing, operations and tech support. He was among the candidates seen as likely to replace retiring Chief Executive Steve Ballmer when Ballmer announced he would step down in 2013, a search that landed on CEO Satya Nadella.

Turner will leave at the end of the month, Nadella said Thursday in an email to employees, and the Redmond software giant doesn’t plan to replace him directly.

Instead, Turner’s groups at Microsoft will be broken up among five executives.

Judson Althoff, who previously led Microsoft’s North American sales unit, will take over the company’s worldwide commercial business, directing sales to large business customers and governments. Jean-Philippe Courtois, formerly the head of Microsoft’s international sales subsidiaries, is assuming the responsibility for sales subsidiaries and marketing worldwide.

Both carry the title of executive vice president, joining the clutch of other top executives who report directly to Nadella.

Other groups formerly under Turner will report to Chief Marketing Officer Chris Capossela, corporate strategy chief Kurt DelBene, and Chief Financial Officer Amy Hood.

Corporate reorganizations are something of an annual tradition when Microsoft rings in the company’s new fiscal year, which begins in July.

Before joining Microsoft in 2005, Turner spent nearly two decades at Wal-Mart, rising from cashier to the executive ranks, ultimately running the company’s Sam’s Club retail warehouse store chain.

Turner will become chief executive of Citadel Securities, the broker-dealer unit of a financial firm known for its giant hedge-fund arm.