BT 'welcomes' whopping £2bn investment by French telco Altice
- Reference: 1623330368
- News link: https://www.theregister.co.uk/2021/06/10/bt_welcomes_2bn_investment_by/
- Source link:
Today's move means that Altice UK, a company set up for the acquisition, now holds 12.1 per cent of Britain's former state-owned monopoly.
Execs at Altice – itself owned by French telecoms billionaire Patrick Drahi – were quick to try to calm any jitters, insisting it has "informed the BT Board that it does not intend to make a takeover offer for BT".
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Instead, Altice claimed it holds the board and management team at BT "in high regard and is supportive of their strategy." A sentiment perhaps [2]not shared by everyone in BT's workforce .
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Explaining the thinking that prompted the investment, it said:
Altice UK has made this significant investment in BT as it believes that it has a compelling opportunity to deliver one of the UK Government's most important policies, namely the substantial expansion of access to a full-fibre, gigabit-capable broadband network throughout the UK.
Altice believes that the UK provides a sound environment for substantial long-term investment. This is supported by the current regulatory framework which offers BT the appropriate incentives to make the necessary investments.
The UK government agreed recently – on behalf of British taxpayers – to allow [5]BT to pay minimal tax for the next couple of years to help fund FTTP builds. BT had been paying £200-£300m a year.
With BT's share price down more than 58 per in the last five years, it seems like a good time for Altice to swoop in the hope that returns on its investment swell.
Industry watchers will, no doubt, already be sucking hard on the end of their pencils trying to figure out what this means and what might happen to BT over the fullness of time.
[6]UK's BT starts trials of new hollow-core optical fibre networks
[7]Give me a (tax) break: UK broadband plumber Openreach to almost double the number of rural premises to receive FTTP
[8]Dems to ISPs: You're not gonna hike broadband prices, slap restrictions on folks in a pandemic, are you?
[9]Virgin Media adds 200% to its new broadband contracts in 2020, slips back in black (just)
"BT Group notes the announcement from Altice of their investment in BT and their statement of support for our management and strategy. We welcome all investors who recognise the long-term value of our business and the important role it plays in the UK. We are making good progress in delivering our strategy and plan," said BT today.
Earlier this month Virgin Media and O2 formally tied the knot in a 50:50 joint venture as part of plans to expand network reach and invest in next-generation gigabit broadband and 5G services. The new company – [10]which received the regulatory green light in May – said it plans to invest at least £10bn over the next five years in the UK. ®
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[2] https://www.theregister.com/2021/05/12/bt_ee_openreach_redundancies_suspended/
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[5] https://www.theregister.com/2021/05/13/openreach_fttp_target/
[6] https://www.theregister.com/2021/06/01/bt_starts_trials_of_new/
[7] https://www.theregister.com/2021/05/28/openreach_to_add_1000_new/
[8] https://www.theregister.com/2021/01/12/us_broadband_pandemic/
[9] https://www.theregister.com/2021/02/16/virgin_media_2020/
[10] https://www.theregister.com/2021/05/20/virgin_o2_merger_approved/
[11] https://whitepapers.theregister.com/
Re: ",,,allow BT to pay minimal tax for the next couple of years to help fund FTTP builds"
And who owns Openreach?
https://www.openreach.com/about-us/who-we-are
Re: "And who owns Openreach?"
To save some clicks : "Openreach is a wholly owned subsidiary of British Telecommunications plc."
Om Nom Nom
All your cut-price utilities are belong to us. Merci mes chou fleurs!!!
But what about Brexit?
It is a slippery slope. All our infrastructure owned by the French.
I can hear the idiot brigade' pitchforks being sharpened and their rose tinted glasses already steaming up with rage at them foreigners coming over here spending their money.
If only someone could think of the chil- "oh, what is an FTTP roll out anyway deary?"
Re: But what about Brexit?
Well this deal wouldn't have been allowed by the Eu competition authority - but now free of their red tape we can have British infrastructure owned by the French
Re: But what about Brexit?
Sovereignty!!!
- but now free of their red tape we can have EVEN MORE British infrastructure owned by the French.
FTFY.
Altice is the capital-less capitalist's dream, their acquisitions are mostly funded by new debt, never with their own previous capital gains. As a result, their debt (at the end of 2020, the British numbers are still not available) is astonishing for it's size: €22 billion for the French subsidiary, US$26.4 billion for the American one, €7.1 billion for Altice International, etc.
Investment in BT?
It's hardly an investment in BT when all Altice have done is bought some BT shares from the Stock Market. The only people seeing Altic's money are the share holders they bought the shares from.
",,,allow BT to pay minimal tax for the next couple of years to help fund FTTP builds"
A tax break to BT to fund FTTP builds? I thought Openreach was responsible for infrastructure builds. Doesn't this rather contradict the supposition of them being independent entities? Or is BT once again involved directly in infrastructure building alongside Openreach?