BT sheds LatAm ops as part of Global overhaul | Light Reading

BT sheds LatAm ops as part of Global overhaul | Light Reading

BT’s dismantling of its troublesome Global Services unit continues, with the UK incumbent operator announcing that it has agreed to sell “selected domestic operations and infrastructure” in 16 countries in Latin America to CIH Telecommunications Americas, an affiliate of private equity firm CIH Technology Holdings.

The size of the transaction is relatively small, involving assets that generated around 110 million (US$129.6 million) in revenue in the 2018/19 fiscal year. The parties agreed not to disclose the purchase price. BT noted that the divestment includes two fiber networks with total length of 650km, 2,000km of leased fiber lines, four data centers and five teleports. The divested business is headquartered in So Paulo, Brazil.

Although by no means a weighty deal, the move ties in with ongoing efforts by BT to streamline the Global Services business a process that was kicked off in 2017 following an accounting scandal at its Italian unit. BT only recently agreed to sell its Spanish ICT services business to funds managed by Portobello Capital. (See BT Cuts 4% of Jobs, Plans Global Services Overhaul, Dodgy Italian Job Savages BT Earnings, Share Price Tanks and Eurobites: BT Says Adios to Spain.)

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Bas Burger, CEO of BT Global Services, hailed the announcement as “a key milestone in the execution of our strategy to become a more agile and focused business.” Burger also indicated that BT has no intention of abandoning Latin America, noting that the group is to “begin a new chapter in the region with CIH, providing continuity for our people and our customers.”

To achieve this, BT and CIH have entered into wholesale and reseller agreements, under which CIH will act as a regional channel for BT’s products and services and continue to supply domestic connectivity services to BT. George Kappaz, chairman of CIH, indicated that the deal allows his group to re-enter global telecoms after having focused on the technology sector over a number of years.

BT said the transaction is subject to regulatory approval and is expected to complete during this calendar year.

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Anne Morris, contributing editor, special to Light Reading

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