The main features of the restructuring were:

• the UK's largest-ever rights issue;
• the demerger of the majority of BT's mobile businesses to create two separate listed companies, BT Group plc and mmO2 plc;
• the disposal of significant non-core businesses and assets;
• the unwind of Concert, BT's joint venture with AT&T;
• the establishment of customer-focused lines of business; and
• the reduction of our net debt from £27.9 billion at 31 March 2001 to £13.7 billion at 31 March 2002.

Rights issue
On 10 May 2001, BT announced a three for ten rights issue at 300 pence per share. This was well supported by shareholders and closed, as planned, on 15 June 2001. Some 1.98 billion new shares were issued to shareholders who took up their rights, raising £5.9 billion, net of expenses.

Demerger of mmO2
On 19 November 2001, we completed the demerger of mmO2, comprising what were BT's wholly-owned mobile assets in Europe: O2 UK (formerly known as BT Cellnet), O2 Communications (Ireland) (formerly known as Esat Digifone), Telfort Mobiel, Viag Interkom, Manx Telecom and Genie.

BT and mmO2 have, through arm's length negotiations, entered into a number of agreements to define the continuing relationship between the groups. These include:

• until November 2004, we will exclusively promote the mobile products and services of O2 UK to the business market in the UK;
• until 31 March 2003, we will not offer mobile products and services to the consumer market in the UK solely under the BT brand. We may, however, offer mobile products and services under the BT brand if co-branded with the brands of other mobile network operators, and may offer bundled fixed and mobile products under the BT brand; and
• parts of mmO2 are able to use some of our trademarks and brands, including the BT name and the half piper logo, on a transitional basis until 31 March 2003.

Acquisitions and disposals
During the past three financial years, BT made a number of significant acquisitions, including taking stakes in Japan Telecom and J-Phone and control of Viag Interkom, Esat Telecom and Esat Digifone. During the latter part of that period, reflecting the change in the group's strategy, we disposed of a number of businesses and assets, including Yell, Japan Telecom, J-Phone and Airtel. This has enabled us to focus on our core businesses and to reduce net debt. We also transferred assets and businesses to Concert, which was subsequently unwound (see "Concert" below).

Our recent programme of acquisitions and disposals included:

Acquisition and disposal of Viag Interkom
In January and February 2001, we took sole control of Viag Interkom by acquiring the remaining 45% which we did not already own from E.ON (formerly VIAG AG) for £4.6 billion, having already bought Telenor's 10% interest for £1 billion. The wireless business of Viag Interkom was transferred to mmO2 on demerger. The fixed-line business of Viag Interkom is now served by BT Ignite Germany.

Acquisition and disposal of Japan Telecom and J-Phone
In June and July 2001, we sold our 20% interest in Japan Telecom, and our interests in J-Phone Communications and the J-Phone group companies to Vodafone, for £3.7 billion in cash. This is more than four times our original investments, which were made in stages, beginning in the 2000 financial year.

Acquisition and disposal of Cellnet
On 10 November 1999, we acquired the 40% interest in Cellnet Group, our mobile cellular phone operator, that we did not already own for £3.15 billion. This business was transferred to mmO2 on demerger.

Acquisition and disposal of Esat Digifone
In April 2001, we acquired, for £0.9 billion, the remaining 49.5% of Esat Digifone, a mobile operator in the Republic of Ireland, that we did not already own. This followed our acquisition of control of Esat Telecom Group in March 2000 for approximately £1.5 billion. Esat Digifone (now O2 Communications (Ireland)) was transferred to mmO2 on demerger. The fixed-line business of Esat is now served by BT Ignite Ireland.

Disposal of Yell
On 22 June 2001, we sold Yell Group, our international directories and e-commerce business, to a newly-formed company, jointly owned by Apax Partners and Hicks, Muse, Tate & Furst for approximately £2 billion. Yellow Book USA, an independent classified directory publisher in the USA, which we had acquired in August 1999 for £415 million, was sold as part of Yell.

Acquisition and disposal of Telfort
In July 2000, we took full control of Telfort, our Dutch joint venture, by acquiring, for £1.2 billion, the 50% of Telfort that we did not already own. The wireless business of Telfort was transferred to mmO2 on demerger. The fixed-line business of Telfort is now served by BT Ignite Netherlands.

Disposal of Airtel
On 29 June 2001, we completed the sale of our 17.8% interest in Airtel Móvil S.A. to Vodafone for £1.1 billion. This represents a return of almost five times our original investment in the Spanish wireless operator.

Disposal of sunrise communications
On 30 November 2000, we sold our 34% stake in sunrise communications in Switzerland to Tele Danmark for the equivalent of £464 million in cash, realising a profit of over £450 million.

Disposal of British Interactive Broadcasting (BiB)
In May 2001, we exercised our option to sell to BSkyB our interest in BiB, our interactive television joint venture, known as "Open". The consideration, to be received in two tranches (in June 2001 and November 2002), was to the value of approximately £240 million. The first tranche was in BSkyB shares and the second tranche will be in BSkyB shares or loan notes. Shares received are subject to certain lock-in restrictions. In addition, if BiB were to reach a certain value in 2003, we would receive a further tranche, with a value of approximately £120 million.

Disposal of Maxis
On 15 November 2001, we sold our 33.33% interest in Maxis Communications in Malaysia to our partner in Maxis, Usaha Tegas Sdn Bhd, for £350 million in cash.

Acquisition and disposal of Rogers Wireless
On 29 June 2001, we completed the sale of our entire interest in Rogers Wireless in Canada to AT&T Wireless Services for £267 million. We had acquired our interest in Rogers Wireless through a 50/50 partnership with AT&T in August 1999, when, together with AT&T, we acquired the equivalent of approximately 33% of the share capital of the company.

Acquisition of Control Data Systems
On 31 August 1999, we acquired Control Data Systems (now known as Syntegra USA), an international systems integration company based in the USA, for £213 million.

Property sale and leaseback
As part of a wider property outsourcing arrangement, in December 2001, we completed the sale and leaseback of the majority of our UK property portfolio to Telereal, a 50/50 joint venture partnership between Land Securities Trillium and The William Pears Group, for £2.4 billion in cash. Around 6,700 properties - offices, telephone exchanges, vehicle depots, warehouses, call centres and computer centres, totalling some 5.5 million square metres - were effectively sold. The transaction also included the transfer of approximately 350 employees from BT to Land Securities Trillium (Telecom) during the first quarter of 2002.

Under these new arrangements, Telereal is responsible for providing accommodation and estates management services to BT. In return, we pay Telereal around £190 million of annual rental, increasing at 3% a year, for use of the freeholds. In addition, BT has transferred the economic risk on a large portion of its leased properties to Telereal in return for an annual rental commencing at approximately £90 million per annum. We have the flexibility to vacate approximately 35% by rental value of the estate, including existing lease ends, over the contract term at no extra cost.

We have retained direct ownership of approximately 220 properties. A number of these were retained with a view to obtaining better value through other means.

Concert
On 1 April 2002, following an announcement in October 2001, we completed the unwind of Concert, our international joint venture with AT&T, which involved the return of Concert's businesses, customer accounts and networks to the two parent companies.

As a result of the unwind, we have largely taken back into our ownership those parts of Concert originally contributed by us to the joint venture, while AT&T has taken back into its ownership those parts it originally contributed. We have acquired substantially all of Concert's managed services network infrastructure in Europe, Africa, the Middle East and the Americas, and substantially all of the customer and supplier contracts that we originally contributed to Concert. Concert assets that have been returned to us are now managed by BT Global Business, part of BT Ignite, while Concert customers that have been returned to us are now managed partly by BT Global Business and partly by BT Retail.

Simultaneously with the completion of the termination of the Concert joint venture, AT&T acquired our Canadian joint venture, through which we held an indirect minority shareholding in AT&T Canada.

Under the Canadian joint venture agreement, BT was committed to participating in AT&T's future obligation to acquire all publicly-traded shares of AT&T Canada. AT&T has now taken full ownership of the joint venture and BT no longer has any involvement in the joint venture, nor any obligations in relation to AT&T Canada.