This article is more than 1 year old

French telco tycoon Patrick Drahi ups Altice UK's stake in BT to 18%, says he is not planning a takeover... at least not yet talks tough: 'We will not hesitate to act if required to protect our critical national telecoms infrastructure'

Billionaire telco tycoon Patrick Drahi has upped his stake in BT to 18 per cent but says he is not intending – at least not yet – to launch a full-blown bid to buy the business, a move the UK government warned it may thwart anyway.

In June, Drahi's Altice UK wolfed down a 12.1 per cent stake in BT for £2bn, with the exec saying he would not attempt a takeover, meaning he was bound by stock market regulations that prevented him from making further moves for six months until 11 December.

Today Drahi made a further move and said of BT: "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."

Altice UK was set up and is wholly owned by Drahi, who also runs Altice, a French telecoms giant that runs fibre and mobile networks providing services to 40 million clients in France, Portugal and Israel. It began life as a cable company and expanded rapidly via mergers and acquisitions.

Drahi said he'd "engaged constructively" with BT's board in recent months and that Altice UK has restated its position to BT top brass that it "does not intend to make an Offer for BT."

BT, which last month shelved efforts to find an investor to shoulder the costs of building out FTTP in the UK to reach 25 million homes by 2025, also confirmed its cost cutting programme was 18 months ahead of schedule, already making gross annual savings of $1bn.

The group has hired advisory service Robey Warshaw, along with Goldman Sachs to provide consultancy on a range of different scenarios, should Drahi return at some point with a more aggressive takeover strategy.

It said of today's news: "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."

UK government, via the Competition and Markets Authority, is getting more active in the market, and recently deepened its probe into the sale of Arm to Nvidia on the grounds of reduced competition and potential national security concerns. It is taking a similar position of interest with regard to BT.

A government spokesperson said: "The government notes the latest acquisition of BT shares by Altice. We are monitoring the situation carefully.

"The government is committed to levelling up the country through digital infrastructure, and will not hesitate to act if required to protect our critical national telecoms infrastructure."

From January, new legislation will come into force that give the UK government more leeway to scrutinise buyouts, impose conditions on a purchase or - if needed - block it.

Paolo Pescatore, analyst at PP Foresight, said that options remain open but noted the tone from the British administration, saying it is "actively monitoring the situation" and "could block any takeover deal."

BT is yet to figure out a solution for its TV Sport biz, although it has longer term regulatory certainty from Ofcom over limiting prices restrictions on full-fibre wholesale products and the trade deal between the UK and Europe had also given the company greater certainty over its future, said Mark Jackson, owner of ISP Review.

"In short, BT has overcome some of the problems that often discouraged potential bidders in the past, although there are still plenty of hurdles for a suitor to consider (eg, the increasingly competitive full fibre market). Any play for the UK telecoms giant will still be a complicated affair, as the bidder will also need the government on their side – they're currently minded to protect key players in the British technology sector." ®

More about


Send us news

Other stories you might like