BT Buys Plusnet for 210p per share

DocProc

RNS Number:1717M
BT Group PLC
16 November 2006

DC06-616 16 November 2006

BT MAKES RECOMMENDED CASH OFFER FOR PLUSNET PLC

BT today announced it has made a recommended cash offer for PlusNet, offering 210p per share, valuing the company at approximately £67m.

The offer for PlusNet fits perfectly with BT's strategy of providing its customers with the most that broadband can deliver. Broadband is increasingly becoming more than just fast internet access and PlusNet has a strong reputation for both customer service and innovation.

Operating since 1997, PlusNet was listed on the Alternative Investment Market in 2004. It has grown rapidly during the last few years and now has close to 200,000 broadband customers as well as an additional narrowband customer base.

If the offer is accepted, PlusNet will retain its brand and distinct identity. It will continue to operate from its base in Sheffield and Lee Strafford will remain its CEO. For the 12 months to 30 June 2006 the company had revenues of £41m, EBITDA of £7.5m and net income of £3.9m.

BT Retail chief executive, Ian Livingston said: "This offer makes great sense for BT. We already provide the UK's most popular and best-performing ADSL broadband service and this acquisition will ensure that even more people can enjoy our market-leading services. PlusNet's customers and employees will benefit from the combination of PlusNet's excellent platform and access to BT's resources and technology development."

Lee Strafford, CEO of PlusNet said: "I am pleased to announce BT's offer this morning. Whilst the PlusNet Directors continue to believe that PlusNet is a high quality business, our sector is consolidating and there are considerable benefits to PlusNet in becoming part of BT. BT recognises the importance of retaining PlusNet's identity and culture and I believe this will give rise to exciting opportunities for PlusNet, our customers and our employees."

The directors of the company, having unanimously recommended the offer, have provided irrevocable undertakings to accept BT's offer.

Inquiries about this news release should be made to the BT Group Newsroom on its 24-hour number: 020 7356 5369. From outside the UK dial + 44 20 7356 5369

All news releases can be accessed at our web site: http://www.bt.com/newscentre

About BT

BT is one of the world's leading providers of communications solutions and services operating in 170 countries. Its principal activities include networked IT services, local, national and international telecommunications services, and higher-value broadband and internet products and services. BT consists
principally of four lines of business: BT Global Services, Openreach, BT Retail and BT Wholesale.

In the year ended 31 March 2006, BT Group plc's revenue was £19,514 million with profit before taxation of £2,040 million.

British Telecommunications plc (BT) is a wholly-owned subsidiary of BT Group and encompasses virtually all businesses and assets of the BT Group. BT Group plc is listed on stock exchanges in London and New York.

For more information, visit http://www.bt.com/aboutbt

This information is provided by RNS
The company news service from the London Stock Exchange

END
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JohalaReewi

DocProc wrote:

... PlusNet has a strong reputation for both customer service and innovation....

Interesting spin on the word 'strong'

This could be an interesting development...

normanmark

might want to change the title, they havent bought it just yet :rolleyes:

keefrto

Methinks the customer service side will remain the same i.e. BT still has that annoying how many times to press this number b4 I speak to someone and plusnet will have the annoying email a question for customer support. There is nothing like talking to a real person which can prevent any escalation of minute problems.
Watch their space!

Crabman

Yeah, I'm not looking for any drastic improvements in CS. I left Plusnet for AOL, now I'm leaving AOL for who knows which company :wall:

oldwiring

I've an IT friend who worked for ears with BT and mow is independemt. He recommended PN to his large church. He is of opinion that BT's taking over PN is a disaster. Now in the context of what some are saying about PN that is sure somethng to think!

ScratUK

No BT havent bought Plusnet

All they've done is put an offer in of 210p per share.

Lorian

Indeed. Its recommended by the board but they don't have a big $ of the shares. It may also yet be subject to MMC scrutiny.