August 12th 2024.
Telecom mogul Sunil Bharti Mittal's company is making a major move in the global market. His conglomerate will acquire a significant stake in BT Group, the largest broadband and mobile company in Britain. The deal is estimated to be worth around $4 billion and will see Bharti Global, the international investment arm of Bharti Enterprises, purchase 24.5% of BT's shares.
According to a statement released by the firm, Bharti Global will first buy 9.99% of BT's stake from Patrick Drahi's Altice, with the remaining shares to be acquired after obtaining necessary regulatory approvals. While the financial details of the deal have not been disclosed, experts believe that it could be around $4 billion, considering BT's valuation of $15 billion.
This is not the first time that Bharti has had a connection with BT. In the past, BT owned a 21% stake in Bharti Airtel for a brief period from 1997 to 2001. However, this deal is not aimed at acquiring the whole of BT or securing a seat on its board.
Altice, a conglomerate controlled by billionaire Patrick Drahi, is selling its stake in BT as it grapples with a high level of debt. Altice first invested in BT in 2021, purchasing a 12% stake and later increasing it to 24.5%. Unfortunately, BT's shares have plummeted by 33% since Altice's initial investment.
In a statement, Bharti said, "Bharti Global, the international investment arm of Bharti Enterprises, has reached an agreement to acquire 24.5% of BT Group's issued share capital from Altice UK." Bharti believes that this investment will strengthen the ties between India and the UK in the telecom sector, particularly in areas like AI and 5G R&D and core engineering.
Sunil Bharti Mittal, Chairman of Bharti Enterprises, expressed his enthusiasm about the deal and the long-standing relationship between Bharti and British Telecom. He also mentioned that this investment aligns with the vision of Prime Minister Narendra Modi to enhance the India-UK ties.
Shravin Bharti Mittal, Managing Director of Bharti Global, added, "We review global investment opportunities in the world of technology from digital infrastructure to software. BT is well known to us from the long association with Bharti, so we are pleased to have this opportunity to acquire a significant stake in the company." He believes that BT is poised to lead the telecom industry, especially in home broadband services.
BT Group, in a separate statement, welcomed Bharti's investment as a strong vote of confidence in their business and strategy. Allison Kirkby, Chief Executive of BT, expressed her excitement about the partnership with Bharti, given their long-standing relationship. She also mentioned that Barclays Bank and Linklaters LLP served as financial and legal advisors, respectively, for Bharti Global in this transaction.
Overall, this deal marks a significant milestone for Bharti Group and its global expansion plans. It also highlights the potential for collaboration between India and the UK in critical and emerging technologies, as announced during the recent visit of UK Foreign Secretary, David Lammy, to India. Both parties are looking forward to a fruitful and positive engagement in the future.
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