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* Drahi ups stake in BT to 18%
* Drahi says does not intend to make bid for BT
* UK says will act if required to defend critical assets
* BT says to serve all shareholders
(Adds further details)
By Paul Sandle and Kate Holton
LONDON, Dec 14 (Reuters) - Patrick Drahi said on Tuesday he
had increased his stake in BT to 18%, drawing a defensive
response from the British government even though the
Franco-Israeli telecoms entrepreneur said he did not intend to
launch a takeover.
Drahi, BT's biggest shareholder who has pursued debt-fuelled
deals to snap up assets in France, the United States, Portugal
and Israel, said he had engaged constructively with the board
and management of BT and looked forward to continuing that
dialogue.
The British government said it was monitoring the situation
closely and would not hesitate to act if required.
"The government is committed to levelling up the country
through digital infrastructure, and will not hesitate to act if
required to protect our critical national telecoms
infrastructure," a spokesman said.
Drahi announced in June he had bought a 12.1% stake in BT,
worth 2.2 billion pounds ($2.9 billion) at the time.
"We continue to hold (BT management) in high regard and
remain fully supportive of their strategy, principally to play
the pivotal role in delivering the expansion of access to a full
fibre broadband network; an investment programme which is so
important to both BT and to the UK," he said in a statement.
BT said it had been notified that Drahi's Altice UK had
increased its stake.
"The board and management of BT Group will continue to
operate the business in the interest of all shareholders and
remains focussed on the successful execution of its strategy and
building on recent performance momentum," the company said.
Under British takeover rules, Drahi's statement that he does
not intend to make an offer for BT will bar him from such a move
for six months.
He increased his stake, at a price of 1.02 billion pounds
($1.35 billion) based on BT's closing share price on Monday,
after a previous six-months standstill expired at the end of
last week.
The 175-year-old BT is in the middle of a $20 billion
transformational programme to build a national fibre network, a
strategy crucial both to the company and the government, which
is looking to boost regional growth levels.
While British governments have traditionally welcomed
foreign investment and takeovers, any full bid for BT would put
ministers in a difficult position due to BT's role in protecting
national security.
($1 = 0.7569 pounds)
(Reporting by Paul Sandle and Kate Holton; editing by Guy
Faulconbridge)
