The French billionaire Patrick Drahi has increased his stake in BT to more than 24%, but reiterated that he does not intend to make a bid to take over the £15bn British telecoms group.
Drahi, who had control of an 18% stake through his subsidiary Altice UK, raised that position to 24.5% on Tuesday. Drahi’s purchase of 650m shares cost about £960m, at BT’s share price of 147.85p at the close of trading on Monday.
The move comes days after BT announced a massive restructure to become a “leaner business” that will result in the workforce being cut by as much as 55,000 by 2030.
The headcount reduction will come from a combination of natural attrition, cutting contractors at the end of the build phase rolling out fibre broadband and 5G mobile networks nationwide, and a move into AI that could replace about 10,000 jobs.
Victoria Scholar, the head of investment at the online platform Interactive Investor, said Drahi’s stakebuilding was a vote of confidence in chief executive Philip Jansen’s strategic plans.
“Last week BT’s earnings sent shares sharply lower,” Scholar said. “Clearly Altice UK judges that now is an opportune moment to acquire further shares at an attractive price point.”
BT’s share price is down a fifth over the last year, but up almost 30% since the start of 2023.
Drahi built his empire by developing and selling a series of telecoms companies and is best known in the UK for his $3.7bn acquisition of the auction house Sotheby’s in 2019. He is worth an estimated $5.9bn (£4.8bn), according to the Bloomberg Billionaires Index.
His investment vehicle first bought a 12% stake in BT in June 2021, increasing it to 18% later that year. On Tuesday, the company said the stake building was not a precursor to making a full bid for BT.
“Altice UK has restated its position to the board of BT that it does not intend to make an offer for BT,” the company said.
The government had examined Drahi’s previous stake under new tougher new powers to block the takeover of vital national assets under the National Security and Investments Act.
The review concluded last August that the investment did not pose national security concerns and Drahi would not have to reduce his holding.
“Altice is continuing to deny any plans to make an offer for the business but the move will raise eyebrows, particularly given the national security sensitivities around BT and its assets entering foreign ownership,” said Russ Mould, the investment director at the online investment firm AJ Bell.
Drahi’s move comes amid sweeping restructuring and potential consolidation across the global telecoms industry. Last week, Vodafone announced it is to cut 11,000 jobs from its global workforce over the next three years.
On Tuesday, the European Commission confirmed that a contract won by a Belgian-based unit of BT had been cancelled after rivals complained about the way it had been awarded to a firm owned by a non-EU country.
BT’s Belgian unit had been awarded an eight-year, €458m contract, which included the handling of sensitive communications between EU governments, but it was suspended by an EU court after complaints by telecoms operators in Germany and Spain.
“Legal proceedings have prevented the commission from entering into the contract and the economic, technical and operational context for such services has fundamentally changed,” said a spokesperson for the commission, in a statement provided to Bloomberg.
