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The deal will see Altice UK’s 24.5% stake in the business transferred gradually to India’s second largest telco, Bharti Airtel
This morning, it has been announced that billionaire Patrick Drahi’s Altice UK is selling its stake in BT to Bharti Airtel.
The move will see Altice UK transfer its 24.5% stake in the business to Airtel piecemeal, with an initial instalment of 9.99%. The rest of the stake will be transferred following the prerequisite security checks by the UK government.
The financial value of the deal was not announced, but is reportedly around £4 billion.
“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,” said BT CEO Allison Kirkby in a filing statement.
“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. They have a strong track record of success in the sector, and I look forward to ongoing and positive engagement with them in the months and years to come.”
Drahi first took a 12.1% stake in BT back in 2021, creating Altice UK specifically for the purpose. Since then, Altice UK has slowly grown its stake in the business to today’s 24.5%, with Drahi consistently assuring stakeholders that it had no intention of taking over the UK largest telco.
This did not stop rumours flying, however, with reports last year suggesting the billionaire was looking to increase his stake even further, potentially up to 29.9%
In the last year, however, Altice’s fortunes have changed. Drahi’s considerable telecoms empire has been built on a mountain of debt that now stands at around $60 billion. Interest on these debts already account for the majority of the Group’s operating capital, with some of these loans maturing as early as 2027. As such, the Drahi has recently reversed course with Altice, moving to streamline the business and sell off its less critical business units.
This, it seems, is the primary motivation for the sale of the company’s stake in BT.
For Airtel, on the other hand, the acquisition represents a vote of confidence in Kirkby and her long-term strategic vision for the UK operator.
“BT to my mind has a much brighter future ahead and they need to be following their strategy, if I may say, even more boldly,” Bharti chair Sunil Bharti Mittal told reporters.”We are not in this for making a buck or looking at stock markets up or down. We are long-term telecom investors.”
Airtel is not the only company to show growing interest in BT in recent months. Earlier this summer, America Movil’s owner, billionaire Carlos Slim, purchased a 3% stake in the business for £400 million.
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