Bharti Enterprises News: India’s Bharti Enterprises announced that it would buy out Patrick Drahi, the top investor in the British company, for 3.2 billion pounds ($4 billion), or a 24.5% share in BT Group (BT.L). Drahi’s Altice group is accelerating asset sales to reduce the company’s debt load.
One of India’s largest conglomerates Bharti Enterprises is now a significant strategic shareholder in BT Group, whose new CEO Allison Kirkby is working to recover shares by pledging stronger earnings following years of cost-cutting. Bharti’s billionaire founder, Sunil Bharti Mittal, made the purchase.
Owning the Bharti Airtel brand that operates in 17 South Asian and African countries, Bharti Global announced on Monday that it had no plans to acquire the entirety of British Telecom, the largest mobile and broadband provider in Britain and a former state monopoly.
It declared its support for the management team of BT and its “ambitious” transformation program, which aims to construct the nation’s fiber network to deliver long-term sustainable growth.
Patrick Drahi, a Franco-Israeli billionaire who amassed his wealth through debt-fueled acquisitions in the telecom and cable industries, paid approximately 4.2 billion pounds for the 24.5% share in BT, which he acquired in three installments between 2021 and 2023. Divided across US and European organizations, the telecom mogul owes $60 billion on behalf of his Altice firm.
SHARES UP
In early trading, the deal drove BT shares up 6% to 139 pence. It will also act as a litmus test for the new Labour government’s stance on foreign ownership of holdings in strategic industries.
Bharti stated that it has already purchased a 9.99% share but that it will not purchase the remaining 14.51% of BT group until it has received national security clearance from the government.
“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,” Mittal told the media.
Bharti Enterprises owner stated that the current share price of BT Group might be taken into consideration when evaluating the cost of the stake acquisition, which is 3.2 billion pounds, based on calculations by journalists.
“We’re not in this to look at stock market fluctuations or make money. As seasoned telecom investors, we are.”
Following a period of BT observation, Mittal stated that he had recently been approached by the seller and had met with BT personnel.
BT’s stock has dropped 72% since 2015, despite a 24% increase in the last six months as the company’s long-term fiber development is beginning to pay off.
Longtime shareholder Deutsche Telekom owns 12% of BT, and this June, Mexican tycoon Carlos Slim purchased a 3.2% stake in the business, providing support for Kirkby, who took over as CEO of BT in February.
Bharti’s investment, according to her, is a “great vote of confidence” in BT’s approach.
Bharti Enterprises BT Group Open Now
When Drahi invested in BT and its vital communications infrastructure in 2021, it raised concerns and the government announced that it would step in to safeguard the firm if needed.
After five years of upheaval under the Conservative party, Bharti said the purchase was a show of confidence in Britain and its stable economic and policy climate, maybe a gesture to the new government.
The group also mentioned its long-standing partnership with BT Group, which from 1997 to 2001 held a 21% share in Bharti Airtel.
When reporters inquired about the price that Bharti had paid for the shareholding, Mittal referred them to the market and said that the shares had fluctuated between 130 and 142 pence, with dividends distributed.
Although he noted that he had some “ideas” for management, he stated that the group had not requested a seat on the board.
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