Altice ups BT stake
December 14, 2021
By Colin Mann
Patrick Drahi’s Altice has increased its interest in BT Group’s voting share capital from 12.1 per cent to 18 per cent.
In a Statement, the telco said: “The Board and management of BT Group will continue to operate the business in the interest of all shareholders and remains focussed on the successful execution of its strategy and building on recent performance momentum.”
Altice UK, a business wholly owned by Drahi, acquired the 12.1 per cent stake in June 2021 for a reported £2 billion (€2.3bn) to become the largest shareholder. Under Takeover Panel rules, Drahi was restricted from buying more shares or seeking full control of the telco until now.
Altice UK has told the BT board that it doesn’t plan to make an offer for BT, reiterating Drahi’s earlier pledge.
“We are pleased to take this opportunity to increase our shareholding in BT. Over recent months we have engaged constructively with the board and management of BT and look forward to continuing that dialogue. We continue to hold them in high regard and remain fully supportive of their strategy, principally to play the pivotal role in delivering the expansion of access to a full fibre broadband network; an investment programme which is so important to both BT and to the UK,” Drahi said.
According to Kester Mann, Director, Consumer and Connectivity, CCS Insight, Drahi’s move will accelerate expectations that he will eventually seek to take full control of BT. “A logical next step could be to look to acquire Deutsche Telekom’s 12 per cent stake in the operator and the German company has already indicated that it may be open to an offer,” he notes. “Drahi’s moves will be closely watched by the UK Government. The sale of a British institution such as BT would be politically sensitive, particularly with the Government under mounting pressure over its handling of the Covid-19 pandemic. “Drahi’s ambitions could face resistance from the National Security & Investment Act, due to come into force in January. This would allow the Government to block takeovers of UK companies that are deemed important to national security,” he observes.
“For BT, the ownership uncertainty is an unwelcome distraction as it seeks to turn around its financial performance after a challenging few years. It also comes as it seeks to find a partner or buyer for BT Sport and accelerates its full-fibre roll-out commitments,” he adds.