BT weighs possible sale of Irish business as it unwinds global services
Company has struggled to find buyer for Italian unit but is proceeding with sale of profitable Irish arm
Photograph: Phil Noble/File Photo/Reuters
BT is weighing bids for its Irish business as it continues to unwind its Global Services following an accounting scandal at its Italian business.
The telecoms company is revamping its international arm by cutting off 80 per cent of its corporate customers and selling its array of local networks in an attempt to improve its profitability. BT intends to focus on its 800 largest corporate accounts and strike deals with network owners in international markets to serve multinational business customers.
BT has struggled to find a buyer for its Italian unit, according to people with direct knowledge of the situation. The Italian unit was the centre of an accounting scandal that triggered the exit of senior executives at Global Services and led to a downturn in the wider company’s fortunes.
Instead it has moved ahead with a sale of its Irish division which is profitable. Bank of America Merrill Lynch is handling the process.
News of the sale process was first reported by The Daily Telegraph. BT declined to comment.
BT’s network assets in Ireland will be likely to appeal to infrastructure investors that have been buying up companies across the UK over the past 18 months.
BT has a long history in Ireland, having entered the market via the acquisition in 2000 of a controlling stake in Esat Digifone. The company was on an acquisition spree at the time as it looked to expand into high-growth mobile markets across Europe but the plan backfired as its debt levels grew. By the time Telenor, the minority shareholder in Esat, exercised an option to sell its stake in the Irish business early in 2001, BT was struggling under the weight of its borrowings.
That led to the demerger of its O2 mobile arm, then called Cellnet, including the wireless business in Ireland. It later sold its fixed-line consumer business in Ireland to Vodafone to focus on corporate customers where it competes with Vodafone and Eir, the incumbent operator.
Ofcom opened an investigation into BT’s behaviour in Northern Ireland this month after a complaint from Eir that it discriminated against its rival when it won a major public sector contract. – Copyright The Financial Times Limited 2019