HP tipped to take over BT's datacentres in £1.5bn deal

CEOs plan back-scratching calls this week?

Posted in Servers, 12th May 2008 16:57 GMT

HP is expected to take BT’s UK datacentres off its hands in a £1.5bn deal.

The arrangement will see BT offloading 400 staff and 24 data centres to the Silicon Valley giant in return for £1.5bn in cash, according to the Sunday Times. BT will continue to access the centres under a ten year deal. At the same time, the telcos current deal to manage HP’s voice and data networks in Europe will be extended worldwide.

The companies already have an outsourcing alliance, priced at $1.5bn when it was first announced back in 2004, which included worker swaps.

Now that that deal turned into a tighter, long-term alliance between HP and BT there will inevitably be speculation that the two companies are heading for a merger longer term. However, according to the Sunday Times, insiders are “playing down” the prospect.

The deal is still being thrashed out the report said, but should be finalised within weeks.

BT said it was unable to comment today, while HP said "If there are developments relating to the alliance between British Telecom and HP we will inform you through our usual channels."

Both companies are due to report their latest results this Thursday. BT’s results announcement will also be the last for CEO Ben Verwaayen, who has overseen BT’s drive into the services market.

So, the cynical might suggest Thursday would be a perfect day to announce a tie-up – HP’s Mark Hurd would get to trumpet a massive deal to shareholders, while Verwaayen leaves his shareholders with a big pile of HP's cash and make BT’s services arm look more profitable.

Of course, the firm's communications departments will argue this is simply a coincidence of corporate calendaring.®

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