Bharti Global, the international investment arm of Bharti Enterprises, has completed the acquisition of 24.5% stake in UK’s BT Group plc, marking the Sunil Mittal-led company’s second major international foray after venturing into Africa in 2010. The deal was estimated to be around $4billion.
Bharti, which runs India’s second largest telecom company Airtel, is now the majority shareholder in UK’s second largest telecom company, the BT Group, formerly British Telecom.
“We wanted to inform you that Bharti Global, the international investment arm of Bharti Enterprises (Bharti), a leading Indian business group with world-class companies in telecoms, digital infrastructure and space communications, has successfully completed its acquisition of an interest in c.24.5% of the issued share capital of BT Group plc from Altice UK,” the company said in a statement on Monday.
“We’re delighted to have completed our investment into BT,” said Sunil Bharti Mittal, Chair of Bharti Enterprises. “Bharti has long recognised the enormous potential of the business. BT’s renewed focus on optimisation, strengthening networks and driving consumer growth makes it well placed to consolidate its position as a leading global telecoms company that delivers long-term value for investors.”
The BT stock was trading at 143.52 pounds, up 1.07% on Monday, giving it a market cap of about 14.3 billion pounds ($18.5 billion). The market cap of Bharti Airtel, Bharti Enterprises’ telecom unit, stood at Rs 8,75,619 crore at close of trade Monday. The stock closed 0.83% lower at Rs 1,537.70 on the BSE Monday.
BT Group said that Bharti’s scale of investment is a vote of confidence in the group’s future.
“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,” said Allison Kirkby, BT Group Chief Executive, said. “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.”
In August, Bharti Group had announced that it is set to acquire 24.5% stake in BT, which was estimated to be worth $4 billion. Mittal had said the price was attractive and that BT was a $25 billion revenue and $10 billion ebitda company.
Referring to the Bharti-BT deal back then, India’s Prime Minister Narendra Modi had posted on X, “I want Indian companies to become multinational. They should have their arms elsewhere too.”
ET had reported that Bharti Group has raised about $1.8 billion from Barclays for its proposed acquisition. The acquisition of 9.99% stake in BT via open market trade was made by Bharti Global, through Bharti Televentures. The remaining 14.51% was bought after regulatory clearances.
Interestingly, BT previously owned 21% of Bharti Enterprises’ India telecom unit, Bharti Airtel, from 1997 to 2001. In a reversal, Bharti is now acquiring a stake in BT from the Altice group, controlled by billionaire Patrick Drahi, who is exiting amid struggles with high debt. Altice first took a stake in BT in 2021 by acquiring a 12% holding, later increased to 24.5%.
Airtel has operations in 17 countries, in Africa and South Asia (including India), with over 567 million subscribers.
BT’s shares have risen 18% year-to-date, but that’s after having fallen over 72% since 2015. The shares were dragged by the stiff competition it faced from smaller fibre-network companies. But the shares rebounded after the company raised its dividend, ending a period of uncertainty after Allison Kirkby replaced Philip Jansen as CEO.
Source: Economic Times