BT scales back in Italy

In another trimming down of its Global division, previously named Global Services, BT has struck a preliminary agreement with Telecom Italia (TIM) to offload two business units.

One business unit provides communication services to a number of Italy's ministries and agencies at national and local government level, while the other offers connectivity and cloud services to the country's SMEs.

The agreement also includes customer support for the SME business unit, delivered by BT's Palermo contact center.

The UK-headquartered operator nonetheless said it will still retain a "strong presence" in Italy, serving large enterprises and multinational companies. As for TIM, it believes the two acquisitions will help "accelerate digitalization" of public administration and beef up its SME portfolio.

The shedding of the two business units will not put a huge dent in BT's top line, since they generated relatively modest sales of €90 million (US$109 million) during the fiscal year ending in March 2020. BT's overall turnover was £22.9 billion ($27.7 billion) in the same fiscal year.

If all goes to plan, the transaction is expected to be done and dusted by the end of the first quarter next year. As well as needing approval from the relevant authorities, the proposed deal is also subject to consultations with trade unions.

The scaling down of operations in Italy follows sales of other European assets in Spain and France, although in both instances – as is the case with Italy – BT emphasized it would still provide connectivity and cloud services to big multinational companies.

Oh, and see you in court

Italy is not the happiest of places for BT with its operations there under scrutiny following allegations of accounting irregularities aimed at massaging revenue and profit numbers.

Last month, a Milan court decided there were grounds for putting on trial 20 defendants that were allegedly involved, setting a trial date for January 26.

Each of the defendants, which include Richard Cameron, the former CFO of Global Services, and Corrado Sciolla, the former president of Europe and Latin America for Global Services, has denied any wrongdoing.

— Ken Wieland, contributing editor, special to Light Reading

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