Disposal

British Telecommunications PLC
13 November 2000

BT TO FOCUS ON BUSINESS SERVICES IN SWITZERLAND 
FOLLOWING SALE OF SHAREHOLDING IN SUNRISE

BT to realise £390 million return on investment after three years


BT today announced that it has reached a definitive agreement to sell its 34
per cent stake in Sunrise (1), its joint venture in Switzerland, to a fellow
shareholder for £460m in cash. 
The move will allow BT Ignite to focus on opportunities for its corporate
broadband business within this important European market. Sunrise will
continue to act as a distributor of global network services from Concert (BT
and AT&T's joint venture) and BT Ignite's broadband services.  BT's plans for
the future include the creation of an Ignite presence in Switzerland to serve
business customers with broadband data and voice solutions. It will focus on
distributing and operating advanced Internet Protocol (IP) based services (2),
such as IP Access, IP Virtual Private Networks, server- and web-hosting, plus
carrier voice products. 
       BT's stake in Sunrise, which operates primarily in the consumer fixed
and Internet market, is being sold with the consent of all Sunrise
shareholders (3) to TeleDanmark for SFR 1,170m (£460m) in cash. Since 1997,
when BT joined the Sunrise consortium, its total investment has amounted to
£70 million.  
The sale is the first of a series of non-core disposals by BT following the
announcement last week of its intention to tighten its strategic focus.  It
comes ahead of the Swiss 3G licence auction. BT has previously stated that its
preferred route to 3G is through businesses with existing 2G operations.
Sunrise was not awarded a 2G licence in the 1998 'beauty contest' for
spectrum. 
       A BT spokesperson said: 'We had an opportunity to sell our stake at an
attractive price, at a time when we want to consolidate our operations and
focus on the high-growth business market in Switzerland. Switzerland has
always played an important role for us, and we intend now to make the most of
its position at the heart of Europe and its unique business environment. This
is a case of the right deal at the right time.'
 
NOTES TO EDITORS

(1) Sunrise is a joint venture formed in 1997 to take advantage of
liberalisation of the Swiss telecommunications market. It offers residential
customers fixed telephony and Internet access, as well as global and domestic
network services to business customers and other telecoms operators. 
        
(2) Ignite's portfolio of advanced IP-based services include:

* IP access, allowing businesses to link to the Internet with high-speed,
high-availability connections;
* IP virtual private networks (IPVPNs), combining the security benefits of
private networks with the low costs of the Internet;
* Server and web-hosting, to manage customers' own Internet servers in secure
premises and look after their presence on the world wide web;
* Applications service provision (ASP), which allows customers to benefit from
the latest business productivity applications without having to retain scarce
and expensive IT skills in-house;
* Broadband point-to-point connections, both domestically and internationally,
used by major corporates and telecoms carriers to transport immense volumes of
data around the globe. 

(3) Shareholders in Sunrise before BT's sale of its stake to TeleDanmark were:
* British Telecommunications plc;
* TeleDanmark AS, Danish operator of fixed, mobile and Internet services;
* Union Bank of Switzerland (UBS);
* Swiss Federal Railways (SBB).

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