BT Group PLC (LSE:BT.A) has abandoned plans to sell its sports broadcasting arm and instead is setting up a joint venture with Eurosport owner Discovery.
Existing major sports broadcast rights, which include Premier League and Champions League matches, would be part of the venture while customers would get access to Discovery's sport and entertainment content, including the discovery+ app.
READ: BT downgrades full-year revenue guidance as pandemic and supply chain issues continue to bite
In a statement alongside its third-quarter results, BT said that after a “detailed process to identify the best way to generate investment and strengthen our Sports business,” it had decided to enter exclusive discussions with Discovery.
“The new business would be a 50/50 joint venture, bringing together BT Sport with Eurosport UK,” it added.
Speculation leading up to today’s announcement had been that sports streaming business Dazn, headed by Sir Leonard Blavatnik, was a front runner to buy the business.
The aim is for the new JV to be operational later this year, subject to completion of the deal and approval by the relevant competition authorities, said BT
Brokers estimate BT Sport is losing around £100mln a year, but is useful in attracting customers to other parts of the business.
Marc Allera, BT Consumer’s chief executive, said: "The proposed joint venture with Discovery, Inc. would create an exciting new sports broadcasting entity for the UK and would act as a perfect home for our BT Sport business.”
Separately, BT said it has also reached an agreement in principle with Sky to extend their reciprocal channel supply deal beyond 2030.
"The agreement in principle with Sky will provide our customers more choice and more flexibility for the next decade," said Phil Jansen, BT’s chief executive.