Splitting DBA Role At Instance Level

I work for a central IT facility which provides services to all the departments in the organisation. Management are proposing to extend the current database hosting service to a full blown DBA service as well. The role is to be split between the hosting team, who had also been providing high level functions like replication, and a dba team who will take on the database administration. There is to be a strict delineation of responsibilities with the hosting team looking after everything at the instance level and the database team managing the databases. The hosting team will retain the sysadmin role and grant sql permissions to the database team as and when they need them.