BT signs $3bn 'blockbuster' deal with Reuters
Telecoms giant BT today unveiled a “blockbuster” deal to supply network services to news group Reuters for around $3bn (€2.23bn).
The deal – BT’s biggest ever service contract – is part of a strategy to reduce its dependency on less lucrative fixed lines services by providing networks to multinational companies.
BT also announced it is to buy financial services network provider Radianz from Reuters for $175m (€130m).
The contract lasting eight and a half years follows a series of similar wins by BT as it continues the expansion of its global services division – linking up firms which have sites across the world.
BT chief executive Ben Verwaayen said it was a blockbuster deal that would bring significant benefits to both companies.
He added: “The acquisition of Radianz is of strategic importance as the global financial services market offers a huge opportunity to BT.”
Traditional lines are facing fierce competition and are becoming a smaller part of the overall communications market.
BT has been cashing in on this by expanding its network services arm, recently signing an agreement with American pharmaceuticals firm Bristol-Myers Squibb and a contract with banking giant Barclays.
It recently said sales involving “new wave” services, which include information and communication technology products, rose 35% in the final three months of its financial year, helping offset an 8% decline in revenues from its more traditional telecoms operations.
Sales of these new services accounted for a quarter of the company’s business - compared with 18% in the same period a year earlier.
The Reuters contract is subject to the completion of the Radianz deal, which depends on regulatory approval expected in the next three months.
Shares in BT fell 2.5p to 202.75p, while Reuters dipped 3p to 413.5p.
