Viatel Technology Group, a Dublin-based digital technology company, is among parties running the rule over UK telecoms giant BT Group’s Irish unit, which was recently put on the market for a second time in five years, according to sources.
BT Ireland is also said to have received interest from other players. However, it was not possible to confirm the identity of those parties.
BT chief executive Allison Kirkby signalled in May that the group was “exploring options to optimise [its] global business” as it refocuses on its home market amid a multibillion-pound cost-cutting programme.
The UK group had previously entered exclusive talks in 2019 to sell BT Ireland to UK investment firm Mayfair Equity Partners. However, the talks broke down early the following year, with the decision reportedly down to a change of heart on the part of BT at the time.
A spokesman for Viatel declined to comment, while a spokeswoman for BT Ireland was not in a position to comment when contacted by The Irish Times.
A unit of Australian financial services giant Macquarie bought a significant minority stake in Viatel – whose business spans cybersecurity, networking, cloud computing and communications services – last December for an undisclosed sum, giving the company more firepower as it continues to pursue deals.
Data centres are energy-hungry and employ few people, so why does Ireland need more of them?
Other shareholders include entrepreneur Colm Piercy’s Chirisa Investments, tech investor Quay Ventures and Viatel’s management.
Viatel, which is led by former Microsoft Ireland chief executive Paul Rellis, has carried out nine acquisitions since 2020. Last month it completed the purchase of the technology division of print services and security systems group MJ Flood.
The deal, reported earlier this year to be worth about €30 million, expands its position in cybersecurity, cloud computing and communications.
Other purchases in recent years include Limerick-based ActionPoint, a digital transformation specialist, telecoms companies Ripplecom, Nova and Rocket Broadband. It employs about 350 people.
BT Ireland, which is led by managing director Shay Walsh and has about 650 employees, is the second-largest fixed-line wholesaler in the Republic with wholesale customers including Vodafone, Sky and Three and corporate customers including Bank of Ireland.
It has also operated the Republic’s 999 and 112 emergency call-answering service (Ecas) for the past 15 years.
The company recently pulled out of the running in a Department of Communications tendering process relating to the next Ecas contract. BT Ireland’s agreement runs until November 2025, though there is a clause in the documents that allows the Government to extend the term for a further two years.
Industry sources previously said the decision to back out of the procurement process for the next emergency calls service contract, a low-profit line of business, may boost the appeal of BT Ireland to potential buyers. It is not clear whether any of the parties circling BT Ireland are interested in managing the remainder of the Ecas contract.
BT made an initial foray into the Republic in 1998 when it set up Ocean, a fixed-wire joint venture with ESB. The London-based group acquired Denis O’Brien-founded Esat Telecom two years later.
It subsequently bought ESB out of Ocean to settle a dispute with the State-owned electricity group over the Esat deal.
BT rolled Esat’s mobile business, Esat Digifone, into its wireless division, which would be spun out in 2011 as a separate company initially called mmO2, but later rebranded O2. Spain’s Telefonica bought O2 in 2005, before selling the Irish mobile business to Three Ireland in 2014.
Sources had previously indicated that UBS was advising BT on the sale of the Irish unit. However, the process is actually being managed by investment bankers in Citigroup.
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