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BT proposes independent board for Openreach to fend off break-up threat

A logo is seen on a BT Openreach engineer's van parked in central London, Britain, February 29, 2016. REUTERS/Toby Melville

LONDON (Reuters) - Britain's biggest telecoms provider BT offered on Monday to appoint an independent board and chairman to run its Openreach network division in an attempt to appease rivals and prevent the break-up of the group. Speaking a day before regulator Ofcom issues its verdict on how BT should improve performance, Chairman Mike Rake said the group realised it had more to do to improve its network but that forcing separation was not the right way to go. BT has already offered to increase spending on the division that runs the network - Openreach - and on Monday it went further by spelling out its plans to give the unit greater autonomy. "We're absolutely willing to form an Openreach board that would have an independent chairman, a majority of independent directors. We're willing to give more authority to Openreach in determination of its capital investment programme," Rake told BBC Radio. "But we believe very strongly ... that this would be the wrong time to break up BT and distract us from the remaining investment to get superfast and ultrafast broadband right across the country in the next two to three years." Shares in BT rose 2.3 percent as investors welcomed the proposal for an independent Openreach board. The 170-year-old BT has been under fire for years from its rivals who accuse the group of underinvesting in the national network that is used by all providers to offer broadband and telecoms services. Rivals to BT, including TalkTalk and Sky, assert that Britain would have better broadband connections if Openreach was spun off. In response BT points out that holding Openreach within the wider group enabled it to invest in new technology through the economic downturn. Ofcom has so far said there should be wider separation between Openreach and its owner to boost investment and improve broadband access for households, but that for now a full separation is not seen as necessary. (Reporting by Kate Holton; Editing by William James and Susan Fenton)