RIL says report of its bid for BT is ‘baseless’

Wednesday 01st December 2021 05:54 EST

Reliance Industries has denied it wants to make an offer for BT after an Indian newspaper reported it was interested in the UK telecoms group. Reliance called the article as “speculative and baseless”, after shares in BT jumped as much as 9 per cent on word of a potential bid. “We categorically deny any intent to bid,” said Reliance, controlled by Mukesh Ambani.

The Indian conglomerate includes Jio, the telecoms company that used aggressively low pricing to win more than 420m users and has overseas ambitions. This year, Reliance bid for a controlling stake in T-Mobile, the Netherlands’ biggest telecoms company, but Deutsche Telekom sold it to funds advised by Apax Partners and Warburg Pincus, the private equity firms, in a €5.1bn deal.

Reliance’s move alarmed some executives in the European telecoms sector wary of an aggressive and ambitious new entrant in their markets, said people familiar with the matter. Private equity interest in European telecoms has been stoked by low valuations and poor growth outlooks. BT has been exploring options under Philip Jansen, who took over as chief executive in 2019 after running
private equity-owned companies, as it looks to end decades of underperformance.

The group is investing in upgrading the UK’s telecoms networks to fibre at a cost of up to £15bn but the weakness of its share price has attracted private equity interest over the past year. BT shares remained 6 per cent higher at 163.5p despite Reliance’s denial, but have lost more than half their value over five years.

The emergence of Patrick Drahi as its largest shareholder has highlighted BT’s vulnerability. Restrictions on the
French billionaire behind the Altice telecoms business in France, Portugal and Israel bidding or raising his stake
in BT are lifted on December 10.
Shares in Reliance closed up a little more than 1 per cent yesterday.

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