BT may or may not be in talks to sell a stake in Openreach - UPDATED
The news today is whether BT is really in talks with potential stake holders which could result in an injection of cash that will therefore allow Openreach to race on with its 20 million premises passed by full fibre.
The Financial Times is believed to be the original source of the public side of the news but while this reports that Macquarie (an Australian bank) is in talks with BT and a sovereign wealth fund whose identity is unknown is also involved in the talks.
Reuters has a source telling it that Macqarie is not in talks with BT or Openreach.
The positive for BT would seem to be that with external funding it make it easier to manage to take on the increased numbers of staff to build its full fibre network. The downside would depend on what those putting down the stake of multiple billions of pounds were to expect back and over what sort of time frame.
Most of the talk of take-overs or sell-offs of Openreach ended when Ofcom finalised the fate of Openreach a couple of years ago. This left BT retaining ownership of Openreach rather than a fully standalone Openreach but Openreach was to have its own board and greater control of its direction. At the time the various divorce options that could be imposed were been considered once a full standalone Openreach was considered ripe for a takeover, either for asset stripping that would make existing sweating of copper assets look very mild or someone keen to spend to build a world leading full fibre network.
If the talks are happening and do produce a lump of cash to build a FTTP network easily there are numerous regulatory issues that will arise and even if agreement was reached on terms by the end of May 2020 it may take a year or more for clearance from finance regulators. A bigger hurdle may be institutional shareholders of BT Group who will want reassurances about the future.
There are many who still see Openreach in the light of decisions made a decade ago by BT Group, but since the settling of the dust around the degree of legal separation that Ofcom settled on in 2017 things have signficantly changed and in April 2018 the FibreFirst programme was announced with premises passed starting to increase significantly by December 2018.
Update 3:15pm The Register has published an exert from a memo sent to staff by Openreach boss Clive Selley who has spoken to BT Group CEO Philip Jansen with the short summary being the story that surfaced in the evening of 14th May is inaccurate.