- Verizon and BT are merging their international enterprise operations in a 50:50 JV
- The JV combines BT International and Verizon’s international enterprise division
- The business is worth approximately $4 billion in combined annual revenue
Verizon and BT are merging their international enterprise operations in a 50:50 joint venture valued at $4 billion. The combined business will serve about 3,000 customers in 180 countries, according to a press release about the deal.
The JV combines BT International with Verizon’s international enterprise wireline arm, which provides secure connectivity to enterprises worldwide. Both BT and Verizon will hold equal voting rights and Verizon has agreed to pay BT an equalization payment of $625 million, stated the press release.
What are the current CEOs saying?
Clive Selley will continue to lead BT International as CEO to ensure readiness for the creation of the JV.
Verizon’s leadership remains unchanged, according to the announcement. Dan Schulman, CEO of Verizon, said in the press release, "Our international customers require secure, flexible connectivity that works seamlessly across borders and cloud environments. When we thought about how to best support them, this joint venture was the clear answer: a cutting-edge, AI-ready and secure platform run by a single global organization dedicated to their needs. At the same time, our relationship with those customers will stay equally strong as we continue to directly provide them with the connectivity they need in the U.S."
“Customers will benefit from new, secure and resilient connectivity platforms, which are designed for the age of AI and sovereign where it matters. It will create new opportunities for our people and long-term value for our owners. Today’s announcement marks a major milestone for BT International, and an important step forward for BT as a whole, as we deliver on our UK-focused strategy," stated Allison Kirkby, CEO of BT.
Who is the CEO of the new JV?
The two companies appointed Martijn Blanken as CEO-designate of the JV, conditional on the completion of the transaction. Blanken has almost three decades in senior leadership positions across telecommunications, technology and digital infrastructure at Telstra, Openwave Systems, EXA Infrastructure and KPN, and a career spanning four continents. Beginning on Sept. 1, 2026, he will join BT and will work with both parent companies, while observing relevant regulatory requirements, as they prepare for the launch of the proposed new company.
A strategic retreat
For Verizon and BT, the deal is an opportunity to divest underperforming businesses, said analyst Jitesh Bhayani, IDC research VP, WW Telecommunications Services.
"On the surface it looks like a growth play," he said. "It's at least as much a retreat both companies are shedding units that were subscale, low-margin and strategically peripheral to their core businesses."
International wholesale and enterprise connectivity is a tough business for telcos and that looks likely to continue, Bhayani said. "The hyperscalers like Google, Meta, Microsoft, Amazon have been quietly winning the long-haul infrastructure battle for a decade. They generate the bulk of transoceanic traffic and increasingly own the cables carrying it. The margin pool available to traditional carriers in this segment keeps shrinking."
He added, "Combining two subscale operations doesn't reverse that dynamic, but it does create a more defensible position than either could sustain independently." It remains to be seen whether the combined entity "can find durable revenue in multi-cloud orchestration and sovereign connectivity, or whether it's managing a more orderly decline."
AI takes a backseat
AI was a main focus of the joint announcement, particularly "how the new JV could help multi-national companies with AI workloads and bring increased flexibility in data movement internationally," said analyst Roy Chua, founder and principal at AvidThink. But AI might not be the "main takeaway" from the deal, he said.
Instead, the main takeaway might be increased efficiencies from scale, improved footprint, savings from deduplication and improved focus, Chua said.
The JV will most likely compete with other global providers, including Orange Business, AT&T, NTT, Vodafone, Tata Communications, Telefónica and Colt, for multinational connectivity contracts and managed network services, Chua said.
Analyst Sid Nag, president and chief research officer at Tekonyx, said, "Details are pretty scant. The announcement is full of buzzwords. I think every possible buzzword is included in the announcement."
The joint venture is likely to evolve into an infrastructure platform, combining intelligent routing, policy-based data sovereignty, workload-aware traffic engineering and an agentic network organization and management plane, Nag said. "They're essentially building a single observability operational fabric. Enterprises are looking more and more into these kinds of connectivity and networking environments," Nag said.
This type of network automation and autonomy is a requirement of emerging, highly distributed AI workloads, where training is done in hyperscalers and inference happens at the edge, he said.
Sovereignty is an important component of the deal, particularly for European enterprises. BT already operates a sovereign environment. "Verizon gets that piece in their arsenal," Nag said.
Sovereignty skepticism
But Bhayani is a bit skeptical of sovereignty. "It's real, but it's also fashionable right now, so some skepticism is warranted. Multinationals — particularly in Europe — are under genuine regulatory pressure around data residency and cloud concentration, and a neutral orchestration layer that isn't aligned with any single hyperscaler has legitimate appeal in that context. The JV's positioning as 'sovereign-where-it-matters' speaks directly to those anxieties," he said.
"The caveat is that sovereignty has become one of the more overused terms in enterprise technology marketing. Whether it functions as a real moat or a slide deck theme comes down to whether [BT's] Global Fabric can actually deliver the portability and compliance capabilities that buyers need and whether buyers are willing to pay a premium for it. The thesis is plausible. The proof will be in the renewal rates," he said.
The Global Fabric prize
For Verizon, Global Fabric is the "clearest prize," Bhayani said. "It's a network-as-a-service offering that lets multinationals manage connectivity across cloud environments, and it's the asset that reportedly attracted Verizon's interest in the first place. Verizon's own international wireline business had nothing comparable."
The divestment also allows Verizon to unburden a unit that was hurting margins and redirect attention to domestic priorities, including the Frontier integration, fiber buildout and convergence strategy, Bhayani said.
"BT gets cash and closure," Bhayani said. "After more than 18 months of trying to find a buyer for its international unit, it exits the drag, books $625M in equalization proceeds, and keeps a 50% stake in whatever upside follows. That's not a bad outcome for the seller in a long process. The $625M isn't transformative against roughly £20B in net debt and a pension deficit that widened to around £4.2B by March 2026, partly reflecting a ~£300M write-down tied to Thames Water exposure, but it's accretive to Kirkby's cash flow story and removes a cash-burning unit from the equation."
Bhayani concluded: "This is a sensible, well-structured deal given the constraints both companies faced. The risk is execution: Governance in 50:50 structures is notoriously difficult, the integration footprint is enormous, and the AI-era connectivity thesis has to show up in actual customer wins, not just messaging. If Global Fabric performs, this will look like a smart call in a few years. If it doesn't, it's a tidy cleanup that bought time. Right now, it's too early to know which story this becomes.”
Fierce Network has reached out to both companies for comments but had not heard back as of press time.
UPDATE, July 29, 7:44 p.m. E.T. — Added analyst comments.