It’s Official – BT Announces £12.5bn Deal For EE, Shuns O2 Partnership

BT has ended weeks of speculation by announcing that it is to sign a mobile deal with network EE.

The operator, which had reportedly been in takeover talks with both EE and competitor O2, has apparently plumped for the former company based on the strength of its 4G network, which currently reaches 75 percent of the UK population and has around 4.2 million subscribers.

BT will pay £12.5bn in a combination of cash and shares to acquire EE, which was formed in 2010 as a joint venture between Orange and Deutsche Telekom and was recently named as the best operator in London by watchdog RootMetrics.

Takeover

The acquisition will allow BT “to accelerate its existing mobility strategy whereby customers will benefit from innovative, seamless services that combine the power of fibre broadband, wi-fi and 4G,” a company statement said.

BT hopes to ensure a smooth transition mainly through network and IT rationalisation, back-office consolidation and savings on procurement, marketing and sales costs. The company also confirmed it would be looking to maximise the potential of the deal through selling fixed-line services to those EE customers who do not currently take a service from BT, and by accelerating the sale of converged fixed-mobile services to BT’s existing consumer and business customers.

Following the deal, Orange will hold a 4 percent stake in BT, with Deutsche Telekom holding a 12 percent stake, as well as being entitled to appoint one member of the BT Board of Directors.

It was reported last month that BT was in talks with both EE and O2, as the company was keen to make a major push into the mobile market despite exiting the sector nearly ten years ago with the sale of O2 to Telefonica.

The decision was thought to have been made in a BT board meeting last Friday, although the company said that this was a regular scheduled occurrence.

An EE takeover would unite the UK’s largest fixed and mobile communications company,with the BT statement saying the new entity would include the company’s 24.5 million direct mobile customers.

What do you know about BT? Find out with our quiz!