Oct 25, 2018

BT cuts off investors calling for shake-up

News of a new chief executive at BT should have been cause for celebration for investors who have seen the UK telecoms group's market value halve over the past two years. Jan du Plessis, who marked his first anniversary as BT chairman by appointing Mr Jansen, ruled out a clean break with the past when he said a full spin-off of the company's Openreach network division or a dividend cut were off the table. Mr Jansen has been drafted in to pick up the pieces of the Patterson era, which has been broadly defined by a push into media - via expensive sports rights - at the expense of investment in faster fibre broadband networks. Stephane Beyazian, an analyst with Raymond James, said the new chief executive would have to resist regulatory pressure for a nationwide rollout of fibre optic broadband and should ponder whether to continue to invest £1bn a year in sports rights when it needed to cut its overall costs by £1.5bn. Mr Jansen might also be tempted to make a "Transformational acquisition or merger" in the technology sector to boost BT's anaemic growth rates, he added. Mr Jansen was linked to the top job at BT in 2002, but Ben Verwaayen was instead handed the task of turning around a business that had been on the verge of collapse.

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