BT Regulatory News (BT.A)

16 December 2022

BT GROUP TO COMBINE ENTERPRISE AND GLOBAL UNITS TO CREATEBT BUSINESS

BT Group has today announced that it will be combining its Global and Enterprise units into a single B2B unit, BT Business. The combined unit will enhance value for all our B2B customers, strengthen our competitive position, and deliver material synergies by:

· Leveraging the full scale and capabilities of BT Group to develop and deliver market-leading products and services for all our B2B customers, including next generation connectivity and unified communications, multi-cloud networking, and advanced security solutions.

· Creating a single interface to BT Group for our corporate customers and public sector institutions, combining our vertical sectoral expertise and capabilities, and removing the current duplication between Enterprise and Global.

· Driving significant and rapid gross annualised cost savings of at least £100m by the end of FY25 through consolidation and rationalisation of management teams, support functions, product portfolios and systems.

BT Business will be led by Bas Burger the current CEO of BT's Global unit. Bas joined BT Group in 2008 and prior to the Global role was responsible for BT Americas. Before joining BT Group, Bas was executive president and a member of the management committee of Getronics NV, where he ran global sales, channels and partnerships, developing the company's international business. He was also CEO and managing director of KPN Entercom Solutions.

This will create a simpler BT Group with three Customer Facing Units: Consumer supporting UK consumers; BT Business supporting business and public sector customers; and Openreach delivering UK nationwide fixed access infrastructure.

Announcing the formation of BT Business, BT Group Chief Executive Philip Jansen said:

"BT Group is a leading provider of B2B connectivity and related services to UK and multi-national corporations, government and public sector organisations worldwide, as well as UK SMEs1 and SoHos2. BT Enterprise is the market leader in the UK, with a market share of 30% underpinned by BT Group's fixed and mobile network leadership, the strength of the BT brand, and national sales, service and distribution. BT Global serves many of the world's largest companies and is consistently rated as a leader for its networking and security services and has ambition to be the leading provider of secure multi-cloud connectivity." 

"By combining the two units, BT Business will bring the Group's combined assets, products, capabilities and brand to the service of all of our 1.2m business customers who will benefit from faster innovation and delivery. Bas is an excellent leader and I'm confident he will build on the plans already underway and drive the combined business back to growth."

1Small and Medium Enterprises

2Small Office/Home Office

BT Business will create a B2B focused telecoms and technology business which in FY22 generated pro-forma revenues of approximately £8.5 billion and EBITDA of over £2 billion.

The formation of BT Business is expected to deliver at least £100m of gross annualised savings by the end of FY25. These will contribute to BT Group's previously announced target to deliver £3bn in gross annualised savings across the same timeframe.

BT Business will continue to invest in the skills, technology and partnerships required to achieve its ambition of returning to growth and become the leading provider of secure multi-cloud connectivity.

Bas will lead the new unit from 1st January 2023 and it will commence reporting as a single unit from 1st April 2023.

The CEO of BT Enterprise, Rob Shuter, will support Bas with the integration over the next few months and will then be leaving BT to step down from executive life and spend more time with family and on his personal interests.

Philip Jansen commented:

"Throughout the past two very challenging years, Bas and Rob have provided outstanding leadership. Covid accelerated a shift in the market as people and businesses changed the way they worked, whilst macro-economic factors have disrupted supply chains and put pressure on businesses and the public sector globally. Despite this, we've made progress and our customer satisfaction scores have improved, in some cases to an all time high. I am grateful to Bas and Rob for laying the foundations that enable us to take this next step in BT Group's transformation." 

"Bas and the Global and Enterprise teams will now work out the details of the integration over the next few months. I would like to reiterate my thanks to Rob for his contribution to BT over the last two years and wish him well for the future."

Ends

About BT

BT Group is the UK's leading provider of fixed and mobile telecommunications and related secure digital products, solutions and services. We also provide managed telecommunications, security and network and IT infrastructure services to customers across 180 countries.

BT Group consists of four customer-facing units: Consumer serves individuals and families in the UK; Enterprise and Global are our UK and international business-focused units respectively; Openreach is an independently governed, wholly owned subsidiary, which wholesales fixed access infrastructure services to its customers - over 650 communication providers across the UK.

British Telecommunications plc is a wholly owned subsidiary of BT Group plc and encompasses virtually all businesses and assets of the BT Group. BT Group plc is listed on the London Stock Exchange.

For more information, visit www.bt.com/about