Bharti will become BT’s biggest shareholder after buying a 25%, $4B stake from Altice | TechCrunch

BT, the U.K.’s former incumbent telecoms carrier, is picking up a major new investor today as telecoms companies look for stronger footing in the rapidly-shifting technology and communications market. Bharti, the Indian tech and telecoms giant that owns Airtel among other assets, said it would purchase a 24.5% stake currently owned by Altice. Based on BT’s market cap of around £13 billion ($16 billion) the time of the deal, this values the stake at around $4 billion.

Bharti said in a statement that it would buy 9.99% immediately, with the remainder coming after regulatory clearance.

Altice has found itself on unstable footing over its debt-led acquisitions and corporate scandals, as detailed in this story at the end of 2023. Altice — which owns other technology and communications stakes — had bought its stake in BT in several tranches, initially in 2021 and later in May 2023. BT’s share price has dropped since since then in part due to overall declines in technology and communications stocks. Altice now appears to be in divestment mode: This deal is coming on the heels of it selling Teads to Outbrain for around $725 million less than two weeks ago.

5G and AI are two of the biggest existential milestones for telcos at the moment. They might turn out to be threats, or opportunities, depending on how carriers play their cards. Bharti cited both in its rationale for this deal, likely looking for better economies of scale on both fronts in terms of purchasing, development and strategy amid a strong competitive approach from technology giants threatening for further cannibalize telecoms companies with new approaches to communications that bypass telco infrastructure.

“Bharti hopes that this investment will further help create new synergies in the telecom sector between both countries in the areas of AI and 5G R&D and core engineering amongst others, offering great potential to collaborate on industry best practices and emerging technologies,” the company said in a statement. Airtel, Bharti’s mobile carrier, is in hot competition with Jio at home in what many consider a duopoly, so investing abroad gives Bharti more diversification.

Interestingly, BT — riding high on its incumbency status in the U.K., at a time when telecoms was king — was once the one doing the investing: it held a 21% stake in Bharti between 1997 and 2001.

“Bharti and British Telecom (BT) have an enduring relationship going back more than two decades wherein BT owned 21% stake along with 2 board seats in Bharti Airtel Limited from 1997-2001,” noted Sunil Bharti Mittal in a statement. “Today marks a significant milestone in Bharti Group’s history as we invest in BT – an iconic British Company.”

BT was considerably less verbose on the news of the deal.

“We welcome investors who recognise the long-term value of our business, and this scale of investment from Bharti Global is a great vote of confidence in the future of BT Group and our strategy,” Allison Kirkby, BT’s CTO, said in a statement, the company’s only comment on the deal. “BT has enjoyed a long association with Bharti Enterprises, and I’m pleased that they share our ambition and vision for the future of our business. They have a strong track record of success in the sector, and I look forward to ongoing and positive engagement with them in the months and years to come.”

Additional reporting Manish Singh