As expected the ‘I’s have been dotted, the ‘T’s have been crossed and the UK’s largest mobile operator is now a division of its dominant fixed-line player.

Scott Bicheno

January 29, 2016

2 Min Read
BT officially completes EE acquisition

As expected the ‘I’s have been dotted, the ‘T’s have been crossed and the UK’s largest mobile operator is now a division of its dominant fixed-line player.

The official announcement was directed at the city and so came cluttered with the kind of arcane legalese gibberish they seem to like over there. Even once the standard hedging caveats had been exhaustively explored the main announcement lacked panache.

“Following the announcement earlier today regarding the Admission of 1,594,900,429 Consideration Shares, BT announces that completion of its acquisition of EE Limited took place today,” it said. “Together with the Consideration Shares, Deutsche Telekom and Orange have received cash consideration of £3,464m in total. As a result of the acquisition, Deutsche Telekom and Orange own 12% and 4% respectively of BT’s issued share capital.”

There has been no other formal acknowledgment of the big moment from BT other than the announcement the CEO of BT Wholesale – Nigel Stagg – is moving on after 36 years with the company. It’s not clear whether this is linked to the ongoing challenges BT faces regarding Openreach, but Stagg is presumably pleased they’re no longer his problem.

Claire Cassar, CEO mobile fraud prevention specialist Haud, approves of the move. “Telecoms mergers such as this are the sign of a changing market, which must be embraced across the sector,” she said. “Given the European Union is keen not to overstretch licenses and ensure markets have optimum service levels, forgoing the opportunity to unify BT and EE, and other proposed mergers like O2 and Three, in the UK, and also Orange and Bouygues, in France would be a real mistake.”

The stage is now set for BT to do battle in the UK multiplay market. Its main competitors are Vodafone, Sky and Virgin Media, which have strengths in mobile, content and fixed-line respectively, but none of them have all three covered anywhere near as well as BTEE.

Perhaps coincidentally Sky has been promoting its next generation Sky Q platform today and Paolo Pescatore of CCS Insight is impressed. “This punchy offer is more aggressive than we had anticipated. Rivals should be concerned with Sky Q and its potential for further disruption,” he said. “Articulating the vast array of features will be a challenge. Despite this, Sky has a long track record in successfully marketing any new services and we firmly believe that Sky Q will be no exception.”

BTEE’s competitors can’t afford to sit back and let the enlarged company entrench its position and it would be little surprise to see further M&A activity in the UK comms market this year.

About the Author(s)

Scott Bicheno

As the Editorial Director of Telecoms.com, Scott oversees all editorial activity on the site and also manages the Telecoms.com Intelligence arm, which focuses on analysis and bespoke content.
Scott has been covering the mobile phone and broader technology industries for over ten years. Prior to Telecoms.com Scott was the primary smartphone specialist at industry analyst Strategy Analytics’. Before that Scott was a technology journalist, covering the PC and telecoms sectors from a business perspective.
Follow him @scottbicheno

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