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Bharti Enterprises announced on Monday that it has reached an agreement to acquire a 24.5% stake in telecommunications giant BT Group PLC, marking a significant move as the Indian conglomerate aims to bolster its global footprint.

Initial Acquisition and Future Plans

Bharti Televentures UK Ltd., a newly established entity by Bharti to facilitate the acquisition, will initially purchase a 10% stake in BT from Altice UK Sàrl, a subsidiary of French telecommunications and media conglomerate Altice Europe N.V. The remaining 14.5% will be acquired once regulatory approvals are obtained. Bharti has not disclosed the financial details of the transaction but noted that it is seeking clearance from the U.K. government under the National Security and Investment Act 2021.

Strategic Investment and Advisory Team

Sunil Bharti Mittal, chair of Bharti Enterprises, emphasized that the planned investment underscores the company's confidence in BT's strategic direction. "BT's focus on strengthening its networks, driving consumer growth, and optimizing every aspect of its business makes it well-placed to consolidate its position as a leading global telecoms company," Mittal said.

Bharti has a longstanding relationship with BT, dating back to when the British telecoms firm held a 21% stake in Bharti Airtel Ltd., a subsidiary of the Indian conglomerate, between 1997 and 2001. Despite the significant stake acquisition, Bharti clarified that it does not intend to make a bid for the entire company.

Regulatory Considerations and Market Reaction

Bharti Enterprises’ acquisition of a 24.5% BT stake from Altice is contingent on regulatory approvals, which the company is currently pursuing. The acquisition highlights Bharti’s commitment to supporting BT’s strategy, particularly its goal of providing full-fiber broadband to 25 million premises by 2026.

Susanah Streeter, head of money and markets at Hargreaves Lansdown, remarked that Bharti’s investment reflects strong confidence in BT’s long-term potential. "Bharti Global is clearly confident that there is long-term untapped value in the group," she noted. Streeter also suggested that Bharti may have been encouraged by signs that the costs associated with building 5G infrastructure have peaked.

Bharti To Buy 24.5% BT Stake From Altice : Bharti's Global Expansion

This acquisition is part of Bharti's broader strategy to expand its international presence. Bharti Airtel, one of the company's flagship ventures, operates networks serving over two billion customers globally. Additionally, Bharti Global, the conglomerate’s international investment arm, has made several notable investments in the U.K., including a 21.2% stake in OneWeb, a space communications company.

Bharti To Buy 24.5% BT Stake From Altice : Financial Performance of BT

BT, listed on the FTSE 100 index, reported pre-tax profits of £8.1 billion ($10.3 billion) for the fiscal year ending in March, a 2.5% increase from the previous year. The company attributed this growth to its successful strategy of expanding full-fiber broadband coverage across the U.K. Following the announcement, BT’s shares rose 6.6% to 139.1 pence.

Bharti, BT, and Altice declined to provide additional comments on the deal.