BT Group Bharti Enterprises' international arm to buy 24.5% stake in UK's BT Group worth $4 bn
London/IBNS: Bharti Televentures UK Ltd, a wholly owned subsidiary of Bharti Enterprises’s international investment arm Bharti Global, will buy a 24.5 percent stake in British Telecom (BT) Group Plc, the United Kingdom's largest mobile and broadband services provider, the companies said in a statement on Monday (August 12).
According to reports, Billionaire Sunil Bharti Mittal-led Bharti Enterprises' international arm will pick up the equity from telecom services provider Altice UK, which has a 24.5 percent stake in BT Group.
As per the statement, Bharti Televentures UK Ltd will buy 9.99 percent stake of BT Group from Altice UK immediately, and the remaining 14.51 percent after receiving regulatory clearances under the UK National Security and Investment Act.
However, the companies did not reveal the exact value of the deal, while Bharti Enterprises, which also owns Bharti Airtel Ltd — India's second-largest telecom operator with operations in Africa, clarified that the funds were not connected to Bharti Airtel or any of its subsidiaries.
At current market price, a 24.5 percent stake purchase is valued at Rs 31,850 crore or roughly $4 billion, making it one the biggest outbound deals struck by an Indian company, reports Moneycontrol.
According to the Financial Times, Altice UK’s 24.5 percent stake in BT Group was worth about £3.2 billion ($4.08 billion) based on the last closing price on the London Stock Exchange.
This transaction will make Bharti Global the largest shareholder in BT Group, as per reports.
The latest acquisition highlights Bharti Group's growing global ambitions and plan to strengthen its presence in the international telecom market, reports Moneycontrol.
"It’s a big investment in a storied company in a space that we understand," Bharti Enterprises chairman Sunil Bharti Mittal was quoted as saying by Moneycontrol.
Currently, the market capitalisation of Bharti Airtel is around Rs 8.26 lakh crore, which is much higher than BT Group's Rs 1.39 lakh crore, as per reports.
Reuters reported, citing Mittal, that the transaction price was near the current market price of BT Group, while Bharti Enterprises has not asked for a board seat.
BT Group's shares have risen by 24 percent in the last six months, according to reports.
“We welcome investors who recognise the long-term value of our business, and this scale of investment from Bharti Global is a great vote of confidence in the future of BT Group and our strategy," BT Group's chief executive officer (CEO) Allison Kirkby said.
"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," Kirkby added. "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."
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