Bharti Global has agreed to acquire approximately 24.5% of the issued share capital of UK’s telecommunications holding company BT Group from Altice UK. The financial terms of the deal were not revealed.
In line with the transaction, Bharti Televentures UK, a company established and wholly owned by Bharti Global, has entered into a binding agreement with Altice UK to acquire about 9.99% stake of BT Group’s issued capital. The remaining 14.51% of BT Group’s share capital will be acquired upon obtaining necessary regulatory clearances.
BT Group deal testament to closeness with Bharti, say both firms
Bharti Enterprises is also applying voluntarily for UK National Security and Investment Act clearance. The Indian conglomerate confirmed that it does not plan to make an offer to acquire the British telecommunications holding company and will adhere to the terms of Rule 2.8 of the UK Takeover Code.
According to various reports, Bharti Enterprises’ minority stake in BT Group is worth around $4bn. The latest move will also make the Indian conglomerate the biggest shareholder in the UK telecom company. “We welcome investors who recognise the long-term value of our business, and this scale of investment from Bharti Global is a great vote of confidence in the future of BT Group and our strategy,” said BT Group chief executive Allison Kirkby. “BT has enjoyed a long association with Bharti Enterprises, and I’m pleased that they share our ambition and vision for the future of our business.”
Through the investment, Bharti Enterprises stated that it aims to strongly support BT Group’s executive team and its ambitious transformation programme to drive long-term, sustainable growth. The commitment is also in line with the BT Group’s fibre expansion plans, its 5G rollout, and its development of advanced services for various needs, said the Indian conglomerate.
Bharti Enterprises’ partnership builds on its long-term investments across the UK and familiarity with BT Group’s business. BT Group had been a significant minority shareholder in Bharti Airtel with a 21% stake from 1997 to 2001.
“BT has a strong portfolio of market-leading brands, high-quality assets and an experienced management team with a compelling strategy mandated by the BT Board to deliver value over the long term, which we fully support,” said Bharti Enterprises chair Sunil Mittal. “Bharti and BT have enjoyed a longstanding relationship – BT previously owned a 21% stake along with two board seats in Bharti Airtel Limited from 1997 to 2001.”
Consolidation in the UK telecoms market
Barclays Bank through its investment bank served as the sole financial adviser for the transaction, with Linklaters acting as Bharti Global’s legal adviser. Altice founder and controlling shareholder Patrick Drahi is estimated to have spent around £4.2bn for the stake in BT Group, which he acquired in three steps from 2021 to 2023. Currently, Altice has $60bn in debt, spread across entities in the US and Europe.
This new development in BT Group’s ownership has come amid broad consolidation within the UK telecoms sector, as rival Vodafone proposes to merge its UK telecommunications business with CK Hutchison’s unit Three UK. The deal, if approved by the Competition and Markets Authority, would create the country’s largest network operator.
The merger has been conditionally approved on security grounds by the UK Cabinet Office and is currently being reviewed under the UK Competition and Markets Authority.
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