BT Group enters exclusive negotiations to acquire EE in £12.5bn deal 15 December, 2014 - 17:08 BT Group has entered into an exclusivity agreement with Deutsche Telekom and Orange in relation to BTs possible acquisition of all of their UK mobile business, EE, in a £12.5bn deal. EE has 24.5m direct mobile customers and reported Adjusted EBITDA of £1,588m for the 12 months to 30 June 2014. The period of exclusivity will last several weeks allowing BT to complete its due diligence and for negotiations on a definitive agreement to be concluded. The proposed acquisition would enable BT to accelerate its existing mobility strategy with seamless services that combine fibre broadband, Wi-Fi and 4G. While continuing these exclusive discussions, BT will progress its own plans for providing enhanced fixed-mobile converged services for businesses and consumers, in line with previous announcements. The key headline terms, which are non-binding, include a purchase price of £12.5bn for EE on a debt/cash free basis. The consideration for EE will be payable as a combination of cash and new BT ordinary shares issued to both Deutsche Telekom and Orange. Following the transaction, Deutsche Telekom would hold a 12% stake in BT and would be entitled to appoint one member of the BT Board of Directors. Orange would hold a 4% stake in BT. In considering the financing of the cash element, BT has a range of options and is mindful of the importance of maintaining a conservative financial profile. BT expects significant synergies mainly through network and IT rationalisation, back-office consolidation and savings on procurement, marketing and sales costs. In addition, BT expects to generate revenue synergies 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 BTs existing consumer and business customers. If a transaction is agreed, approval by BTs shareholders will be required as a condition of the purchase.
Posted on: Tue, 16 Dec 2014 17:44:08 +0000
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