Altice UK Raises Stake in Telecoms Giant BT to 24.5 Percent

Broadband giant BT Group is facing renewed fears of a possible takeover attempt by French billionaire Patrick Drahi’s Altice UK today, which has once again increased its stake in the telecoms giant from 18% to 24.5% – just a shade under the level that might typically spark an investigation (another one).

Alice UK has been gradually increasing its stake in BT since it invested around £2bn to take a 12.1% slice of the business back in June 2021, which was then increased again to 18% in December 2021 – prompting the operator to strengthen its defences against a potential takeover attempt (or a demand for the operator to spin off its consumer (Plusnet and EE) or network access (Openreach) division).

In May 2022 this was followed by the UK Government’s decision to conduct a perhaps somewhat premature “full national security assessment” of the situation under the National Security and Investment Act 2021. But this was dropped in December 2022, with the government merely saying that they would “take no further action“, albeit while warning that “any future transaction could be subject to a separate assessment under the Act“.

However, Altice UK has today spent almost £1bn to increase their existing stake in BT from 18% to 24.5%, which puts them just below a key level. A person with significant control (PSC) of a company is generally recognised as somebody who holds 25% of the shares or voting rights, among other things. But Altice UK once again reiterated that it does not intend to make an offer for BT, although that could always change in the future.

German telecoms giant Deutsche Telekom (DT), which holds a 12.5% stake in BT, is another company that has often – for as long as we can remember – been speculated to hold a wider interest in the UK telecoms firm (here), which may yet conceivably involve doing a deal with Altice UK. But so far they’ve been happy to play the waiting game.

As for BT itself, they could be said to have overcome some of the problems 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 full fibre market, the level of debt, political opposition and so forth). But to do anything serious here would require a green light from the UK Government, which has already put one shot across Altice UK’s bow.