BT sells properties

June 13, 2001 Posted: 1123 GMT

LONDON (CNN) -- British Telecom said on Wednesday it sold its UK properties for 2.3 billion pounds ($3.1 billion) as it strives to reduce its huge debts.

The completion of the deal is the latest move in BT's programme to reduce its £28 billion debt mountain caused by an unfocused strategy and the acquisition of third-generation (3G) mobile phone licences at high prices.

"This represents a further step forward in BT's drive for cash and the reduction of its headline debt," said Chairman Christopher Bland.

BT sold the properties to a joint venture set up by property firms Land Securities Trillium and William Pears Group, both named on April 10 as preferred bidders.

BT (BT-A) , which earlier this month launched a record £5.9 billion rights issue to raise cash, plans to reduce its debt by about £10 billion this year.

It sold its Yell business pages unit for $3 billion last month.

The company is also considering the sale of its stake in business services unit Concert to joint venture partner AT&T (T: Research, Estimates).

On Tuesday, BT and Deutsche Telekom announced they would jointly roll out 3G mobile phone networks to cut costs.

Both companies said they expected cost savings of up to 30 percent over the next 10 months as they share networks in Germany and the U.K.

BT last month reported year-end losses of £2.9 billion after taking a £3 billion charge against the goodwill of its German mobile phone business Viag Interkom, which is part of the BT Wireless division that will be spun off later this year.

BT on Wednesday named David Varney, former chief executive of UK gas company BG Group, as chairman-designate of BT Wireless.

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