Deutsche Telekom Boss Renews Speculation of UK BT Takeover8 Sep 2021 09:39
The boss of German telecoms giant Deutsche Telekom (DT), Tim Hoettges, has renewed long-running speculation over their reported desire to gobble the BT Group by hinting that “something is going to happen” with their 12% stake within the next 12 months, before adding that they would do a “good deal” for the UK broadband firm.
For as long as we can remember, Deutsche Telekom has frequently been linked with speculation over a possible bid for BT, although potential suitors have often ended up being discouraged by various concerns over the operator’s complex regulatory position, uncertainties around the outcome of Brexit, challenges due to massive debt (£18.6bn) and pension (£50bn) liabilities, as well as various other issues.
However, the market and BT have gone through a number of key changes over the past year. For example, the BT Group (particularly its Openreach division) has gained some longer-term regulatory certainty from Ofcom, which has enabled them to dramatically expand their £15bn rollout plans for Fibre-to-the-Premises (FTTP) broadband technology (i.e. aiming to cover 25 million UK premises by December 2026).
On top of that, the recent UK and EU trade deal has helped to make the post-Brexit future easier to predict. Lest we forget, Altice UK (Patrick Drahi) also made a surprise move (here) to acquire a sizeable 12.1% equity stake in BT (worth c.£2bn), which is a similar size to DT’s stake. At the time, Altice UK said that it “does not intend to make a takeover offer for BT,” but few believe Drahi will be content to sit on his hands. Meanwhile, BT itself has been busy restructuring itself.
All of this may help to explain BT’s reported move last year to update their bid defence strategy (here), with the operator perhaps being mindful that they are now more accessible to a takeover attempt than they have been at any point in the past decade. This brings us back to what DT’s boss just told analysts.
NOTE: Back when BT and EE merged the company’s shares were worth 441p, but today they’re 164p and analysts believe that 200p would be more reflective.
https://www.ispreview.co.uk/index.php/2021/09/deutsche-telekom-boss-renews-speculation-of-uk-bt-takeover.html
Sign In
Follow the stocks
