BT has rejected an offer made by US consortium Earth Lease led
by US asset finance company Babcock & Brown to purchase its
local loop network. The struggling telecom giant confirmed that it
had been approached by Earth Lease, but had refused its £8 billion
offer without publicly disclosing its reasons.
The local loop connects telecom customers to the telephone
network via copper and fibre lines. The operation of the local loop
has come under attack from the UK Office of Telecommunications
(OFTEL) because BT holds a monopoly over it. The Earth Lease bid
would have enabled competing telephone and cable operators to lease
the lines for a fixed fee. It would also have improved internet
access for consumers in the UK as the consortium proposed to invest
£500 million in high speed broadband developments.
BT has not given any reasons for its decision to refuse the
offer which could have eased its debt, currently standing at about
£16.5 million.
