Business Express is an online portal that covers the latest developments in the world of business and finance. From startups and entrepreneurship to mergers and acquisitions, Business Express provides reporting on the stories that matter most to business leaders and decision-makers.The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.
2023 05 23T061958Z 2 LYNXMPEJ4M05R RTROPTP 4 BT GROUP RESULTS - Business Express

Drahi boosts stake in BT to 24.5%, will not make an offer


Drahi boosts stake in BT to 24.5%, will not make an offer

By Sarah Young

LONDON (Reuters) -Billionaire Patrick Drahi has increased his stake in BT to 24.5% but reiterated that he does not plan a full takeover for Britain’s biggest telecoms group.

The Franco-Israeli entrepreneur has since 2021 been adding to a position in Britain’s 175-year-old former monopoly BT, betting that its $20 billion investment in a new national fibre network will succeed in the long-term.

The network BT is building is viewed as critical national infrastructure by the British government, and it has in the past warned it would intervene to protect the roll-out of that network by the telecoms group if needed.

Drahi’s Altice UK unit on Tuesday lifted its stake to 24.5% from 18%, days after BT’s results showed the pressure its investment in the new fibre network was putting on its free cashflow. Shares in the group lost as much as 10% on Thursday, but have since recovered.

At Monday’s closing price, Drahi’s purchase of BT shares would have cost 961 million pounds.

Enders analyst James Barford said Drahi’s share purchase showed the telecoms investor’s confidence that BT would in future reap the benefits of the fibre build which is expected to more than double future cash flow.

“That’s possibly the opportunity that he’s seen here, in that if he believes that they can deliver on that, and that it’s a strong path,” Barford said.

SHARES STRUGGLE

Shares in BT rose 0.5% to 148 pence in early trading. The stock has struggled this decade, and is way off highs of 500 pence seen in 2015.

Investors will hope for an improvement as the completion of the new fibre network nears in 2030. BT said last week it would cut up to 55,000 jobs in future as it will not need all the contractors and engineers currently building the infrastructure.

Don't miss out on any breaking news or insightful opinions!
Subscribe to our free newsletter and stay updated on the go!


By submitting this form, you are consenting to receive marketing emails from: Global Banking & Finance Review. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email.

Drahi’s statement said Altice did not intend to make an offer for BT, meaning it cannot do so for six months under UK takeover rules, unless circumstances change.

A change of circumstance includes the emergence of a counter offer for BT, or if BT’s board agrees to a deal.

Drahi’s Altice group controls SFR, France’s second-biggest telecoms company, and he also has assets in the United States, Portugal and Israel.

Britain last year investigated Drahi’s investment in BT but found there was no national security risk.

Analysts have in the past speculated Drahi could push BT, which has a market capitalisation of about 15 billion pounds ($18.93 billion), to separate its networks arm Openreach to achieve a higher valuation shorn of the risks related to BT’s enterprise and consumer units.

Deutsche Telekom is BT’s second-biggest shareholder with a 12% stake, according to Refinitiv data.

($1 = 0.7923 pounds)

(Reporting by Sarah Young; editing by Kate Holton and Bernadette Baum)

 

Recent Post: