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Telecoms and broadband giant BT Group has this morning announced that Bharti Mittal, the Founder and Chairman of Bharti Enterprises, and Gopal Vittal, Vice Chairman and Managing Director of Bharti Airtel Limited, will both join the company’s Board as non-independent non-executive directors.
In case anybody has forgotten. Last year saw Bharti Global (via Bharti Televentures UK Ltd), the Indian multinational conglomerate, agree to acquire French billionaire Patrick Drahi’s (Altice UK) stake of 24.5% (issued share capital) – worth around £3.6bn at the time – in the BT Group (here). But BT’s market cap has risen significantly since then (it’s now about £20.50bn), thus this stake is likely to be worth closer to £5bn.
However, while Patrick Drahi seemed more inclined to be a fairly passive shareholder, Bharti may have other plans. But they’ve thus far been very supportive of BT Group’s existing CEO, Allison Kirkby, which is hardly surprising given the operator’s rapidly improved share price over the past year.
Adam Crozier, BT Group Chairman, said:
“We’re delighted to welcome Sunil and Gopal to the Board of BT. They bring significant experience and global perspectives in the telecoms industry, and we look forward to their contribution to the Board and to the future success of BT Group.”
Sunil Bharti Mittal said:
“I am delighted to be joining the Board of BT, an iconic company delivering critical infrastructure and services for the UK. I look forward to working with Chairman Adam Crozier, the Board and CEO Allison Kirkby to drive forward the strategy to win in the market and deliver world-leading services for BT’s customers.”
Gopal Vittal said:
“I am honoured to be joining the BT Board at a pivotal moment for our industry. I look forward to bringing my experience at Airtel to help support BT, whose unique assets and businesses offer valuable opportunities for growth. Airtel and BT have much to learn from and contribute to each other.”
Such developments often have a habit of triggering talk about takeovers etc. On that front, BT itself could be said to have overcome some of the obstacles and uncertainties that often-discouraged potential bidders in the past, although there are still plenty of hurdles for a suitor to consider (e.g. the increasingly competitive UK full fibre market, the high level of debt, high interest rates, political opposition and so forth).
Doing anything serious on this front would thus require a green light from the UK Government, although the UK’s relatively new National Security and Investment Act (NSIA) is unlikely to throw up any real obstacles until or unless Bharti’s stake goes beyond the 25% mark.