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BT takes control of Esat
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February 6, 2001: 7:51 a.m. ET
Telenor exercises option to sell Irish mobile operator for $1.24bn to BT
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LONDON (CNN) - British Telecommunications said on Tuesday it would buy the half of mobile operator Esat Digifone it doesn't already own for $1.24 billion.
The deal comes as British Telecom tries to cut the hefty debts it racked up by buying high-speed mobile licences and additional stakes in other international carriers.
 Analysts had expected Telenor to exercise its option to sell the stake in Ireland's Esat, because the Norwegian telecom firm would not be able to squeeze as much money from another buyer, given current market conditions.
"In this environment, if you can sell telecom assets for prices agreed months ago, you're getting a good deal," analyst Patrick Foulis at UBS Warburg told CNN.com.
BT and Telenor signed an agreement on the option for Telenor to sell the Esat stake in January last year before telecom share prices went into freefall as investors fretted over the cost of investing in third generation, or high-speed, mobile licences.
BT said in a statement on Tuesday that the cost of the additional stake was already factored into its estimated debt level for the year. The company's debts are expected to hit £30 billion ($44 billion) by the end of March.
BT shares rose 0.5 percent to 732 pence while Telenor shares rose 2.1 percent to 44.30 Norwegian crowns in Oslo.
Telenor said the Esat sale, which is expected to be completed during March this year, will reap a pretax profit of about 10.1 billion Norwegian crowns.
Foulis said he expects BT, which is set to announce third-quarter results on Thursday, to post a pretax profit of £1.15 billion ($1.68 billion) for the three months until the end of December. 
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