TalkTalk has sold its SME- and enterprise-focused connectivity unit to its own shareholders.
The UK broadband provider this week confirmed that TFP Telecoms Limited (TFP), a special purpose vehicle controlled by the main shareholders of TalkTalk Telecom Group Limited (TTG), has acquired TalkTalk Business Direct (TTBD) for £95 million ($115m).
Confirmation of the sale comes a week after TalkTalk Group revealed that the company will split into three standalone companies.
TalkTalk stated that the transaction also involves a long-term exclusive wholesale agreement with TalkTalk’s wholesale platform worth around £25m ($30.4m) over three years.
"The transaction delivers both investment for growth for Business Direct, as well as a long-term revenue agreement for our wholesale platform. This is good news for customers and colleagues alike, and is an important first step in our demerger plans," said Tristia Harrison, TalkTalk Group chief executive.
TalkTalk said the sale is the first phase of the firm's demerger strategy which it announced last month.
As part of the separation of its business, the company said that three independent companies will be created, focusing on B2B, consumer, and small businesses.
The three companies will be known as B2B Wholesale Platform, TalkTalk Consumer, and TalkTalk Business Direct.
Current CEO Tristia Harrison will oversee the transition, but is stepping down and will move to a non-executive director of the B2B Wholesale Platform.
She will chair a newly established Oversight Board through to the point of legal separation on March 1, 2024. Harrison has been the Group CEO since 2017.
The new companies will become operationally separate from November 1, 2024, and will legally split from March 1, 2024, confirmed TalkTalk.
All three businesses will be headquartered in Salford, UK, and will continue to be supported by existing TalkTalk Group shareholders.