French Billionaire Allowed To Retain BT Stake After Security Review

No further action to be taken, after government’s national security review of Patrick Drahi’s increased stake in BT Group

The British government has concluded its national security review of a French billionaire’s increased stake in telecoms giant BT Group.

The issue began in June last year, when BT confirmed to Silicon UK that a major French telecoms firm (Altice) had made a surprise purchase of a 12.1 percent stake in the former British telecoms incumbent, making it the largest single shareholder.

The acquiring vehicle was Altice UK, which is wholly owned by Patrick Drahi – a French-Israeli telecoms billionaire, who is also the founder and head of Altice Europe, the second largest telecoms firm in France.

BT stake

Drahi has founded Altice back in 2001, and he is a prolific dealmaker, making a name for himself by snapping up cable and mobile companies in Europe and the United States.

The billionaire entrepreneur was born in Morocco but emigrated to France as a teenager. He has a net worth of $6.6 billion, according to Forbes, and is also the owner of auction house Sotheby’s.

Altice UK said a year ago when it acquired the BT stake, that it did not not intend to make a takeover of the British carrier.

BT meanwhile told Silicon UK last year that it “welcomed investors who recognize the long-term value of our business and the important role it plays in the UK.”

But then in December 2021 Altice UK acquired another 5.9 percent for £2.2 billion, raising its total BT stake from 12.1 percent to 18 percent.

Drahi at the time promised to not launch a takeover bid for six months.

The UK government however bluntly warned all parties involved that it was monitoring the situation.

It stated it would intervene if necessary to protect BT, which owns most of the UK’s critical fibre broadband network.

BT meanwhile reportedly bolstered its takeover defences in December by hiring boutique advisory group Robey Warshaw.

National security

Then in May this year the UK government officially confirmed a national security assessment of Altice’s 6 percent stake increase.

Now BT has informed Silicon UK that Patrick Drahi will be allowed by the government to retain his 18 percent stake in BT.

“On 26 May 2022, BT Group plc announced that it had received notification from the Secretary of State for Business, Energy and Industrial Strategy that he had considered the increase by Altice Europe N.V. of its shareholding in BT Group from 12.1 percent to 18 percent and was exercising his call-in power under section 1 of the National Security and Investment Act 2021 (the “Act”),” the carrier told Silicon UK.

“BT Group has now been notified by the Secretary of State that no further action is to be taken under the Act in relation to the increase by Altice Europe N.V. of its shareholding in BT Group from 12.1 percent to 18 percent.”

There continues to be speculation about Patrick Drahi’s eventual intentions with the BT stake.

His December agreement not to launch a takeover bid for six months expired in June this year, but the billionaire has reportedly previously said he is not interested in a takeover of BT.