Openreach’s CEO, Clive Selley, said, “Openreach is staying in the BT group” in a memo to staff, reported in the Evening Standard.
The memo appears to be in response to an article published in the Financial Times which reported BT was in talks to sell a stake in its most profitable business unit, Openreach.
Openreach is a legally separate, wholesale unit of BT which owns and runs it nationwide access network. The newspaper valued Openreach at £20 billion.
BT’s continued ownership of the unit been a bone of contention for years by its competitors and rumours of selling some or all of the unit off have been rampant as the mother ship’s fortunes have worsened.
Last week BT’s CEO, Philip Jansen, announced the company would withhold dividends for a year, thereby saving £2.5 billion which it will invest in fibre build out and to help it ride future shocks.
It has pledged to invest £12 billion to build out fibre broadband, assuming the government and regulator provides the right conditions to ensure return on investment, but funding this will be a challenge, given that the UK is a laggard in Europe in the deployment of fibre and the take-up rateby subscribers.
It is also likely to face fiercer competition in converged offerings as Virgin Media, which provides fixed fibre and content, merges with the mobile network O2, owned by Telefonica. The deal is yet to be approved.
The Australian Bank Macquarie was cited as a possible buyer, but Reuters reported the bank denying talks with BT about such an acquisition .
In a timely move, ADTRAN just announced speed a deal with Openreach to speed and improve the efficiency of its fibre buildout.