BT focuses on M & A

BT's Indian joint venture, BT Telecom India Pvt Ltd, is buying BT Infonet global managed network services reseller i2i Enterprise Pvt Ltd.
The takeover is BT's 17th acquisition around the world in the past 24 months.
"BT will become the biggest foreign global carrier operating in India today as the result of this deal," BT Global Services CEO Andy Green said in a prepared statement. i2i, a managed service provider, brings a customer base of 200 corporate customers into the BT fold, and it employs more than 200 people.
The price being paid by BT Telecom India, which is a BT joint venture with local Indian company Jubilant Enpro Pvt Ltd., was not disclosed. In a hint, BT said that as of I2i's last audited balance sheet date, March 31 2006, its gross assets were approximately $22.5 million. That suggests a price of not more than, perhaps, $100 million.
While the size of the deal is believed to be relatively small in dollars, "the acquisition of i2i is exciting because it places BT at the heart of the world's fastest-growing IT and business-process outsourcing market," Green said. "This will help BT build a broad-based platform for growth in India and create a single BT-branded channel to the Indian market."
He continued, "India is a cornerstone in our global expansion plans and this investment underlines our commitment to growth from India. BT continues to execute its global mission to be the leader in the delivery of converged networked services."
Indeed, BT recently said it wants $250 million in sales in India by 2008 from its various ventures in the country (TelecomWeb news break, Sept. 14, 2006). It's been coveting an Indian phone license for years (TelecomWeb news break, Nov. 23, 2005) and, in November 2006, BT Telecom India applied for licenses to provide National Long Distance (NLD) and International Long Distance (ILD) services. The BT unit was issued Letters of Intent in December 2006 by India's Department of Telecommunications (DoT), a first step toward the award of licenses. With the acquisition of i2i, it now looks like BT picks up the coveted licenses without further ado. i2i is one of the few companies in India with licenses to provide ILD, NLD, nationwide ISP and Internet telephony services, BT notes.
The acquisition of i2i comes just five days after BT disclosed a deal to buy International Network Services (INS), a Calif.-based provider of IT consulting and software solutions. INS employs almost 900 people in 12 countries worldwide. Again, BT did not disclose financial details but said that, as of the last audited balance sheet on Sept. 25, 2005, the gross assets of INS were $49.7 million. Guesses in the industry are that BT will pay nearly $200 million for the company.
That's a pittance compared with the $3.7 billion that then-Lucent Technologies (these days Alcatel-Lucent) paid for it back in 1999, merging it into Lucent Worldwide Services as the Enhanced Services and Sales division, its enterprise professional services unit. Back then, INS was doing a reported $300 million a year in business, but demand for new network projects collapsed and INS was hit even harder due to the loss of its vendor-agnostic status. Lucent finally sold INS in July 2002, reportedly at a huge loss, creating a privately owned company by venture capitalists.


Source - Telecomweb