Monday saw reports emerge that French Billionaire Patrick Drahi wants to raise his stake in UK broadband and calls giant BT (BT.A).
Drahi, who founded French telco Altice, currently owns a 12.1% stake in BT, which he bought this summer through the entrepreneur’s new vehicle Altice UK, making him BT’s largest shareholder ahead of Deutsche Telekom which owns 12.06%.
The telecoms tycoon has previously said that he holds the board and management team of BT in high regard and is supportive of its strategy. Drahi sees BT as a compelling opportunity to deliver on the UK government’s full-fibre, gigabit-capable broadband network expansion.
EYING MAJOR SHAREHOLDER’S STAKE
Drahi is believed to be interested in buying some or all of Deutsche Telekom’s shares, Reuters reported on Monday, citing a trio of sources. Deutsche Telekom boss Tim Hoettges said at the end of last week that he is keeping ‘all options open’ regarding the BT stake and has said before that it will be reviewed.
Drahi will be able to snap up BT shares from 11 December, but is currently prevented from doing so under London Stock Exchange rules after confirming when his stake was revealed in June that he was not making a full-blown takeover attempt of the UK telecoms giant.
BT has previously said it expects to return to earnings growth in fiscal 2023, after years of declining profits and revenue. The group earlier this month confirmed its outlook for the current and full year to March 2023 after it reported a 3% fall in first half revenue and a 1% rise in underlying profits for the first six months of this fiscal year.
The group reiterated its previous guidance for EBITDA (earnings before interest, tax, depreciation and amortisation) of £7.5 billion to £7.7 billion for the current year and above £7.9 billion for full-year 2023. Revenue for the current full year is expected to be broadly flat.
BRITAIN’S FIBRE ROLLOUT
Earlier this year BT said it targeted building fibre-broadband connections to 25 million homes and businesses in the UK, up from its previous target of 20 million. At the start of November BT announced it had delivered on its cost-savings programme ahead of schedule, with the company vowing to win Britain’s fibre broadband wars, where it faces competition from Virgin Media among others.
BT said that it had pulled off its £1 billion of gross annualised cost savings 18 months ahead of the March 2023 target it had set itself, implying that full year March 2025’s £2 billion savings aim will be pulled forward by a year with further savings coming through in 2025.
That news saw BT shares rally sharply on 4 November, rising 11% to 157.8p, and the stock has continued to find investor support since, currently trading at 167.3p.
