AOL's UK boss stands down as thousands of jobs are lost

The head of the internet giant AOL UK is leaving the company at the end of the month as it prepares to "significantly" reduce its British workforce and close offices throughout Europe.

Michael Steckler, the managing director of AOL UK and Benelux, is the latest casualty of AOL's drive to save $300m across the globe by cutting 2,300 staff. The US parent company warned yesterday that it would have to lay off workers after a voluntary redundancy programme missed its targets.

AOL said Mr Streckler was leaving "to take up new challenges" and his role would be taken over by Kate Burns, AOL's head of European sales, as part of a broader remit. She used to head AOL's social networking site Bebo.

Last November, as AOL prepared to walk away from its disastrous merger with Time Warner, the chief executive Tim Armstrong said the company intended to save $300m by shedding a third of its global workforce "to ensure the long-term health of the business". AOL employed 6,900 people a year ago.

A spokesman said yesterday: "The internet landscape has become increasingly competitive and we are making difficult choices to take costs out of the business and ensure AOL's sustainability and future success." AOL had hoped to encourage staff in the US, Britain, Canada and Ireland to take voluntary redundancy but only 1,100 applied and it believes it needs to lose about 1,200 more. The spokesman added: "At the time, we announced that if we did not reach the target reduction of one-third [of staff] we would need to follow the voluntary programme with involuntary action."

AOL, which currently operates in 11 European countries, is preparing to shut its offices in Finland, Germany, Spain and Sweden, and is in talks about the future of its base in France.

It is not clear how many UK staff will be affected. A spokesman said: "We will be significantly reducing our UK staff but will continue to have a robust advertising operation, as well as a consumer offering."

The company is also closing an office in Seattle, Washington, and redundancies in the US will begin today.

AOL's $164bn merger with Time Warner, viewed as one of the most disastrous tie-ups of all time, caused billion-dollar losses and led to thousands of job cuts at the combined company. The two formally separated on 10 December. Earlier this month, Time Warner's former chief executive, Jerry Levin, apologised for presiding over "the worst deal of the century", saying: "I'm really very sorry about the pain and suffering and loss caused."