Verizon will pay BT an equalisation payment of $625m for the joint venture.
UK’s BT Group and US’ Verizon have decided to combine their international units into a joint venture aimed at multinational connectivity. The parent companies would be better able to focus on their domestic markets, while providing support to the new venture, they said.
The 50:50 joint venture between the communication giants will serve more than 3,000 customers across 180 countries, representing some $4bn in combined annual revenue. Verizon will pay BT an equalisation payment of $625m, the companies said in a joint statement.
The two companies aim to support local compliance and sovereignty needs with their joint venture. Customers are promised “secure and resilient” connectivity, designed for data, operational and regulatory requirements.
The joint venture will be led by Martijn Blanken; former CEO at Neo Space Group and Exa Infrastructure, and a current non-executive director at the Cordiant Capital-owned Irish investment vehicle Speed Fibre Group.
Clive Selley, appointed to his position in April, will continue to lead BT International as CEO, while Verizon’s leadership also remains unchanged.
Speed Fibre Group purchased BT’s Irish wholesale and enterprise business unit in a €22m deal last year.
“Customers will benefit from new, secure and resilient connectivity platforms, which are designed for the age of AI and sovereign where it matters,” said BT Group CEO Allison Kirkby.
“It will create new opportunities for our people and long-term value for our owners. Today’s announcement marks a major milestone for BT International, and an important step forward for BT as a whole, as we deliver on our UK-focused strategy.”
Dan Schulman, the CEO of Verizon, added: “Our international customers require secure, flexible connectivity that works seamlessly across borders and cloud environments.
“When we thought about how to best support them, this joint venture was the clear answer: a cutting-edge, AI-ready and secure platform run by a single global organization dedicated to their needs.
“At the same time, our relationship with those customers will stay equally strong as we continue to directly provide them with the connectivity they need in the US”
Verizon shares fell 5.2pc yesterday (29 June) following the news, rising marginally in after-hours trading, while BT share prices rose 0.6pc.
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