September 05, 2001, 11:44 AM — British Telecommunications PLC (BT) will spin off its recently renamed wireless division mmO2 PLC as a separate, publicly-traded company on Nov. 19.
The demerged mmO2 will carry a debt of 500 million pounds (US$722 million), well below the 2 billion pounds of debt the wireless company had previously been expected to carry, BT said in a statement Wednesday.
The remaining assets of BT will officially be known as BT Group PLC once the demerger occurs, at which time BT shareholders will receive equal numbers of BT Group shares and mmO2 shares to replace their old holdings, BT said.
BT announced in May that as part of its effort to reduce its debt -- then standing at 29 billion pounds -- by over 9 billion pounds by March 2002, it would spin off BT Wireless as a separate company and rename the remaining segments of the company BT Future.
The new mmO2 will be worth an estimated 10 billion to 15 billion pounds and will be launched with a debt level similar to that of its rival Vodafone Group PLC, a BT spokesman said.
In comparison, Orange SA held around 2 billion pounds of debt at the time of its IPO (initial public offering) by parent company France T