BT tries to raise £2bn in property deal

NEWS The Soros-backed Madeley consortium is one of two preferred bidders in the race to buy BT's 7,500 properties for around £2 billion. A top UK property consortium, Land Securities Trillium, is the other runner. A BT spokesman said: "We expect to conclude the arrangements within this calendar year." Up for grabs are BT's offices and its 6,400 exchanges, some of which have spare space. But Oftel has restricted BT's ability to sell the exchanges as part of its efforts to give other telcos access to the local loop to install ADSL. So BT will retain the freeholds, but lease them to the successful bidder for 130 years and then take 30-year leases on them. BT will have the option of vacating the premises after 15 years. Should telephone technology allow BT to abandon its city centre exchanges, whoever wins the property race will have scooped the equivalent of the roll-over lottery. BT has said that it's outsourcing the ownership of its property to increase its operational flexibility in a rapidly changing technological environment. The move is the first concrete step by BT to redeem its promise to reduce its debt by £10 billion this year. It has yet to announce firm plans for any of the potential sales of subsidiaries such as Yell and Cellnet which have been the subject of much speculation.