Aviva Investors has called for BT to raise discussions on a potential sale of its network division, Openreach.
Aviva Investors, which has a stake in BT worth hundreds of millions of pounds, suggested that it is now time for the company to have open discussions with investors about a potential split with its lucrative broadband infrastructure.
Speaking to the Sunday Telegraph, Trevor Green, Aviva’s head of UK equities said: “They obviously have been clear they don’t want to do it, but that doesn’t mean it can’t be done. We just think it should be something which should be explored.”
Green added: ““We want the company to just at least have a bigger debate.
“Gavin Patterson has put his defence on their [BT and Openreach’s] connections and connectivity, defending it all the time.
“I think actually that’s fair, but this debate’s not going away. So let’s have an open discussion about it.”
According to Telegraph, BT shareholders have begun to consider whether they could benefit from a split, despite the corporate upheaval.
A BT spokesman told Telegraph: “We remain firmly of the view that Openreach should remain part of BT.”
The call from Aviva Investors marks the first time a major city firm has contributed to the Openreach debate.
In July, Ofcom made the move for Openreach to become a separate company within BT, in plans designed to assuage concerns about its performance without incurring the full costs of a sell off.
The reforms made by Ofcom were not enough to appease BT’s rivals, such as TalkTalk and Sky, adding further fuel to the 18+ months of Openreach debate.
A Sky spokesperson welcomed Ofcom’s acceptance that “the current Openreach model is not working and that fundamental change is required.” Dido Harding, TalkTalk CEO, followed Sky in praising Ofcom for recognising the “fundamental conflict of interest which hurts customers.”
Then in August, ex-business minister Anna Soubry also waded into the debate, saying that the company’s figures for proliferation of broadband in the UK did not reflect what was happening in the “real world.”
At the time, BT rejected Soubry’s comments, citing independent data (from thinkbroadband.com) stating that 91 percent of UK premises had access to superfast speeds and that this would rise to 95 percent by the end of 2017.
“99 per cent of premises in Ms Soubry’s constituency can access superfast broadband speeds of 24Mb/s and above whilst more than 90 per cent can get ultrafast speeds of 100Mbps and above via alternative networks.
“We disagree with Ms Soubry’s comments regarding the separation of Openreach. We fail to see how a smaller, independent Openreach would be able to invest the £1.4bn each year that it does currently.”