BT’s chairman dismissed speculation that the telecoms giant is planning to sell a stake in its Openreach broadband business on Thursday.
Jan du Plessis told the FTSE 100 listed company’s annual general meeting that Openreach “remains an important part of the BT group”.
The Financial Times had reported in May that BT was in talks with potential buyers for a stake in Openreach to fund a £12 billion upgrade of the broadband network, in a sale that could have valued Openreach at around £20 billion. Potential buyers were reported to include Australian bank Macquarie and a sovereign wealth fund.
The speculation had prompted Clive Selley, chief executive of Openreach, to send a memo to staff informing them that “Openreach is staying in the BT group”. Philip Jansen, BT’s chief executive, told the City in May that he was concentrating on expanding Openreach’s full-fibre network “as fast as we possibly can”.
Openreach is a legally separated company within the BT group but is fully owned by the former public monopoly. Mr du Plessis said that BT was investing heavily in network infrastructure and had announced plans to ramp up the expansion of its full-fibre broadband network, “with a target of reaching 20 million premises by the mid-to-late-2020s, subject to the right political and regulatory support”.
BT cancelled its annual dividend in May for the first time since its 1984 privatisation and analysts have questioned whether BT can fully afford its plans to extend its network.
On Tuesday the government announced plans for the removal of Huawei equipment from the UK’s 5G networks by the end of 2027. Mr Jansen said that the plans to eliminate Huawei’s presence “give us enough time to make all the necessary changes without impacting on the coverage or resilience of our existing networks”.
BT shares fell 0.9 per cent to 114.10p at 10:09 BST on Friday.
17th July 2020.
