BT, Ofcom Reach Agreement Over Openreach Governance

By Tapan Panchal

LONDON--BT Group PLC (BT.A.LN) said Friday it had reached an agreement with the U.K.'s Office of Communications, or Ofcom, that will see its infrastructure division, Openreach, becoming a legally separate company with its own board and management.

Ofcom has been pursuing the legal separation of Openreach on competition grounds. BT has said keeping control of Openreach, which runs the country's network of telecom lines, is key to investment in broadband infrastructure.

The British telecommunications group said around 32,000 employees will transfer to the new Openreach Ltd. once their pension arrangements are in place. Openreach Chief Executive Clive Selley will report to Openreach Chairman Mike McTighe and will be accountable to BT Group Chief Executive Gavin Patterson in regard to certain legal and fiduciary duties consistent with BT's responsibilities as a stock-listed company, BT Group added.

"We have listened to criticism of our business and as a result are willing to make fundamental changes to the way Openreach will work in the future," said Mr. Patterson.

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(END) Dow Jones Newswires

March 10, 2017 02:38 ET (07:38 GMT)

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