Broadband services

Eurobites: DT Has No Plans to Sell BT Shares

  • Deutsche Telekom has no plans to sell its shares in BT in the likely event of a "no-deal Brexit," said Timotheus Höttges, the German operator's CEO, during a phone call with reporters this week. The German incumbent took a 12% stake in in its UK peer back in 2016, when it sold BT its 50% stake in UK mobile operator EE. France's Orange, EE's other shareholder at the time, took a smaller BT stake of 4% and a larger cash payment. It has subsequently sold shares and in June was reportedly poised to sell its final 2.5%. Asked about his own plans, Höttges answered: "We are not planning to sell our shares in BT."

    The brief statement comes after the German operator said "BT continues to be an integral part of our strategic orientation" in its 2018 annual report. Deutsche Telekom's stake in the business makes it the UK operator's biggest individual shareholder, but there is investor concern that a no-deal Brexit -- under which the UK would quit the European Union in October without any kind of agreement -- could trigger a UK recession, with knock-on effects for BT and other companies. For Deutsche Telekom, selling shares now would mean writing off a huge investment: Since BT finalized its takeover of EE on January 28, 2016, its share price has fallen by 63% on the London Stock Exchange, to close at 173.56 pence sterling on August 8. That means Deutsche Telekom's stake is now worth about £3.5 billion ($4.2 billion) less. Ouch.

  • MegaFon, one of Russia's "big three" mobile operators, reported a 4.5% increase in sales and a 20.6% rise in operating income (before depreciation and amortization) for its second quarter, compared with the year-earlier period. With revenues of 85.6 billion Russian rubles ($1.3 billion), and operating income reaching RUB38.9 billion ($590 million), the company had 77.6 million customers across its footprint in Russia and central Asia at the end of June. CEO Gevork Vermishyan hailed progress on digital transformation, drawing attention to a recent agreement with Chinese Internet giant Alibaba for the creation of a Russian ecommerce venture called AliExpress. The update comes weeks after rival MTS was reported to have signed a deal with Chinese equipment behemoth Huawei for the construction of a 5G network in Russia. Locals may soon be swapping blinis and vodka for dim sum and Tsingtao beer.

  • As Europeans get their first taste of 5G services, Austrian authorities are waking up to the possible health risks posed by mobile technology. The country's parliament has accordingly commissioned a study on "5G mobile communications and health" from the Austrian Academy of Sciences and the Austrian Institute of Technology. Results will be published on the parliament's website by January 2020 -- about nine months after the country's 5G spectrum auction -- allowing citizens to read all about the downsides on their 5G-connected devices.

  • German operator Freenet clung to its full-year guidance of stable revenues after reporting a 2.8% increase in sales for the second quarter, to about €1.4 billion ($1.6 billion), compared with the year-earlier period. The operator, which provides mobile and TV services in Germany, also continues to expect earnings (before interest, tax, depreciation and amortization) of between €420 million ($471 million) and €440 million ($493 million), after making exactly €441.3 million ($494.5 million) in 2018. Second-quarter earnings were up 10.5% year-on-year, to €215.5 million ($241.5 million), thanks largely to positive regulatory effects (it's not often that happens). Freenet said its overall subscriber base grew by 62,000 customers in the first six months of the year, giving it 8.224 million customers in total.

    — Iain Morris, International Editor, Light Reading

  • Be the first to post a comment regarding this story.
    Sign In