BT: a game of fantasy M&A?
There’s talk of a bid for BT from Reliance Industries. Is it a serious offer?

Just in time for “panto season” comes word of a bid for BT from Reliance Industries – the behemoth owned by Asia’s richest man, Mukesh Ambani, said Alistair Osborne in The Times. Surely not a serious offer? “Oh, yes it is,” says The Economic Times of India. “Oh, no it isn’t,” retorts Reliance, which calls the rumour “completely speculative and baseless”. Nonetheless, the Government is reportedly monitoring the situation at the former state telco. BT’s shares jumped nearly 10% on the story – and were still up after it was dashed, perhaps reflecting the fact that “there’s been bid talk” ever since the French-Israeli billionaire Patrick Drahi’s outfit, Altice, quietly “snaffled” a 12.1% stake in June. The big prize is seen as BT’s Openreach broadband operation.
Investors are eager for “a quick win”, said Helen Thomas in the FT. Quite understandable given shares have “halved in the past five years”, and “the company is sinking more than £1bn a year into rolling out its full fibre network” for “an as yet uncertain return”. The “euphoric reaction” was also influenced by the huge €33bn bid for Telecom Italia recently tabled by the US buyout giant KKR. Yet even assuming that Openreach could be easily separated out, there’s the “albatross” of BT’s huge pension scheme – not to mention a challenging “political climate”, with even tougher rules to protect national security due in January.
I blame the locals, said Ben Marlow in The Daily Telegraph. If City fund managers “aren’t willing to invest in this country’s future infrastructure, perhaps we can’t complain if an overseas buyer steps in”. Had Britain’s institutional shareholders valued BT correctly, instead of baulking at the upfront roll-out costs, it would never have fallen to becoming “a plaything for international billionaires”.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
-
Work life: Caution settles on the job market
Feature The era of job-hopping for bigger raises is coming to an end as workers face shrinking salaries and fewer opportunities to move up
-
Saving the post office
Feature The U.S. Postal Service is facing mounting losses and growing calls for privatization. Can it survive?
-
Safe harbor: Gold rises as stocks sink
feature It's a golden age for goldbugs
-
What is the Mar-a-Lago accord?
Talking Point A Maga economic blueprint proposes upending the global financial system. Could it fly?
-
Elon Musk: has he made Tesla toxic?
Talking Point Musk's political antics have given him the 'reverse Midas touch' when it comes to his EV empire
-
Texas vs. Delaware: See you in court
Feature Delaware risks losing its corporate dominance as companies like Tesla and Meta consider reincorporating in Texas
-
Trade wars, explained
The Explainer Free trade is almost always good for any economy – so why is it so unpopular?
-
Diversity training: a victim of the 'war on woke'
Talking Point More and more US companies have phased out corporate DEI initiatives, and the incoming Trump administration is likely to fuel the cultural shift