BT share price: Regulatory decision about Openreach expected within weeks

on Nov 28, 2016
Updated: Oct 21, 2019

Regulators expect to announce a final decision on the future of BT Group (LON:BT.A) and its network division Openreach within weeks, The Times has reported. The news comes after Ofcom’s boss warned last week that the former telecoms monopoly had not invested enough in keeping its network up to date. BT is currently under pressure to improve Openreach’s performance to avoid a full-blown break-up.

BT’s share price has fallen deep into the red in today’s session, having lost 1.39 percent to 353.85p as of 13:21 GMT, underperforming the benchmark FTSE 100 index which is currently 0.46 percent worse off at 6,809.37 points. The group’s shares have lost just under a quarter of their value this year, as compared with a nine-percent rise in the Footsie.
The Times reported this morning that regulators had said that they expect to announce a final decision on the future of BT and Openreach within weeks, with Ofcom having approached the European Commission to discuss how it could force the former telecoms monopoly to legally separate from its broadband infrastructure unit. British officials are drafting documents which would enforce the division, should negotiations with the telecoms giant break down.

Ofcom said earlier this year that it would not recommend a full break-up of BT but that it should be run as a legally separate company. The move came after the blue-chip group proposed an independent board and chair to lead the division in an effort to appease the watchdog.
The 22 analysts offering 12-month price targets for BT for the Financial Times have a median target of 475.00p, with a high estimate of 580.00p and a low estimate of 300.00p. As of November 26, the consensus forecast amongst 25 polled investment analysts covering the stock has it that the company will outperform the market.
As of 13:48 GMT, Monday, 28 November, BT Group plc share price is 354.50p.

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