• Skip to primary navigation
  • Skip to content
  • Skip to primary sidebar
  • Skip to footer

SEENIT

TV, Film, Broadband, Pay-TV, Games, Computing & Tech | News, Comment & Reviews

  • ARTICLES
  • ADVERTISE
  • Twitter

BT agrees £12.5bn purchase of EE

February 5, 2015 - Martin Hoscik@martinhoscik

bt_ee_logoBT has agreed final terms for its £12.5bn purchase of EE, the UK’s largest mobile phone network.

EE’s shareholders, Deutsche Telekom and Orange, will receive a mixture of cash and BT shares with Deutsche Telekom entitled to appoint one non-executive member to the BT Board. It will also hold a 12% stake in BT while Orange will hold a 4% stake.

“This is a major milestone for BT as it will allow us to accelerate our mobility plans and increase our investment in them.

“The UK’s leading 4G network will now dovetail with the UK’s biggest fibre network, helping to create the leading converged communications provider in the UK. Consumers and businesses will benefit from new products and services as well as from increased investment and innovation.

“The deal provides an attractive opportunity for BT to generate considerable value for shareholders, with significant operating and capital investment efficiencies supported by our tried and tested cost transformation activities.

“The enlarged BT will offer significant opportunities for employees as we lead the creation of a world-class digital infrastructure for Britain.”

Today’s deal marks a new chapter in BT’s on-off involvement in the mobile sector.

In 1985 it and Securicor formed Cellnet which was one of the UK’s first two mobile operators. Fourteen years later BT bought out its partner, renaming the firm BT Cellnet.

However in 2001 cash pressures helped BT decide to spin-off the company as a standalone entity, now called O2, which was later bought by Spain’s Telefónica.

The company has since offered business and consumer mobile services by piggy-backing on other carriers’ networks but has been unable to match the main networks on pricing and range of handsets and struggled to attract large numbers of customers.

Most recently it signed a virtual network deal with EE and planned to combine the firm’s 3G and 4G network with its own fibre broadband to create a service capable of switching seamlessly between mobile and WiFi to ensure users always enjoyed good reception.

However in November BT said it was in preliminary talks both with O2 and EE about a possible acquisition of an entire network and in December announced it had entered into exclusive talks to buy EE.

BT’s lawyers and accountants have spent the past month examining EE’s finances and contracts for anything which might cause the deal to unravel.

With the due diligence process now complete and final terms of a deal agreed, the company is poised to shake-up the UK’s telecoms sector by offering bundles of mobile, broadband, home phone and pay-TV services on a single bill.

Although TalkTalk and Virgin Media already offer so-called ‘quad-play’ bundles through their own virtual network deals, BT’s ownership of a full network is expected to deliver significant cost savings, potentially allowing it to undercut rivals.

Even before completing the EE purchase, BT’s imminent re-entry into the mobile sector has forced rivals to bolster their own offerings.

Vodafone is expected to launch its own TV offering in the coming weeks while Sky has signed a virtual network deal with O2 which is itself due to be bought by the owners of Three.

EE’s nationwide network of high street stores will provide BT will the opportunity to demo its TV services, including BT Sport, and broadband packages to potential subscribers.

The mobile network’s 24.5m customers can expect to be tempted with deals aimed at persuading them to move to their broadband and TV services to BT.

Customers are also likely to gain bundled access to BT Sport on their smartphones and tablets.

EE Chief Executive Olaf Swantee said: “Joining BT represents an exciting next stage for our company, customers, and people. In the last few years alone, we have built the UK’s biggest, fastest and best 4G network, significantly advancing the digital communications infrastructure for people and businesses across Britain.

“Today’s announcement will ensure the UK remains at the forefront of the mobile revolution, bringing even more innovation and investment in world leading connectivity for our customers.”

Deutsche Telekom Chief Executive Tim Höttges commented: “The transaction is much more than just the creation of the leading integrated fixed and mobile network operator in Europe’s second largest economy. We will be the largest individual shareholder in BT and are laying the foundations for our two companies to be able to work together in the future. This is another example of the consistent and successful execution of our portfolio optimisation strategy.”

Orange Chief Executive Stéphane Richard added: “This is a landmark transaction for Orange and the next natural step in the evolution of BT and EE. We are confident the combined company will go on to provide new and exciting services to its customers as the demand for data and connected services continues to grow.”

The deal is conditional on approval from BT’s shareholders and UK regulators and is expected to complete before the end of BT’s 2015/16 financial year.

Share

  • Click to share on Twitter (Opens in new window)
  • Click to share on Facebook (Opens in new window)
  • Click to share on Google+ (Opens in new window)
  • Click to share on Tumblr (Opens in new window)
  • Click to share on LinkedIn (Opens in new window)
  • Click to share on Reddit (Opens in new window)
  • Click to print (Opens in new window)
  • Click to email this to a friend (Opens in new window)

Related

Tagged With: Telecoms




SPONSORED VIDEO

More

Tenko is coming to True Entertainment this month

Sam Claflin’s WW1 drama Journey’s End is coming to

How Blockchain Can Disrupt the Entertainment Industry

Trailer – Dwayne Johnson in Skyscraper

Jude Law’s eXistenZ and John Cusack’s The Grifters are coming to Blu-ray

ITV’s The Good Karma Hospital is getting a third series

FEATURED

Lost episode of The Avengers is coming to DVD

McMedia – new dogs learn old tricks

Ridley Scott’s The Terror – AMC releases trailer and first look images

Batman: Gotham By Gaslight is coming to Blu-ray and DVD

MORE FROM US

Latest from: streamedTV

Trailer: Netflix first Danish original series, The Rain

Amazon signs development deal with Gone Girl author Gillian Flynn

Amazon Prime Video becomes exclusive UK and Ireland home of US Open Tennis Championships

Amazon’s Dietland gets new trailer

ADVERTISE ON SEENIT

We’re pleased to offer a number of advertising opportunities to high quality brands including sponsored content, competitions and advertising placements.

Please contact us for details.

MORE FROM US

Sports On Telly

Amazon Prime Video takes UK rights to US Open Tennis Championships

Europsort confirms World Snooker Championship coverage plans

Grand National – Most Successful Jockey’s

The Snooker World Championship is the Highlight of the BBC’s Spring Sporting Schedule

Copyright © 2018 MayorWatch Publications Limited · All Rights Reserved · Contact Us · Copyright · Terms of Use · Privacy Policy

MayorWatch Publications Limited · 20-22 Wenlock Road · London N1 7GU · Company Number 6291816

seenit.co.uk uses cookies to ensure we give you the best experience on our site. Accept If you continue without changing your browser settings, we'll assume that you agree to our use of cookies. Read our privacy policy.
loading Cancel
Post was not sent - check your email addresses!
Email check failed, please try again
Sorry, your blog cannot share posts by email.