Drahi reportedly keen to up BT stake despite turbulent times

Patrick Drahi is reportedly looking to increase his stake in BT, a rumour that comes at a time of turbulence for the UK incumbent and for Drahi’s own telecoms empire.

The latest report on Drahi’s intentions towards BT – and there have been many over the past couple of years – comes from This Is Money, which cites unnamed City sources as saying that the French businessman is mulling raising his stake to as much as 29.9%, the highest it could go without triggering a mandatory takeover offer under UK law.

Drahi’s Altice UK operation currently holds 24.5% of BT. It first bought into the UK telco in mid-2021, triggering a flurry of speculation regarding its motives that Drahi sought to play down by emphasising his interest in its fibre rollout plans. While that made sense, given Altice’s own fibre endeavours and the strong investment potential for the technology at the time, talk of a BT takeover bid never really died down and Drahi has fanned the flames by upping his stake twice since, most recently just two months ago.

There’s not much to go on in the This Is Money story, although its worth noting that the paper’s sources say that while Drahi is considering picking up more shares in BT, he has not changed his stance on a takeover bid. The executive has at various times confirmed that he is not looking to take control of BT and that seems to still be the case.

But, as the report points out, a further hike in Drahi’s stake would give rise to another government investigation under the National Security & Investment Act; essentially, the state would need to approve the share purchase and confirm that it poses no threat to national security. Drahi has had to jump through these hoops before, so there’s no reason to assume that he would not be successful again. But a corruption scandal at his telecoms empire outside the UK and a soon-to-be-vacant chief executive’s office at BT mean that the picture is a little different this time around.

The Altice corruption probe stems from the telco’s Portuguese business. Altice co-founder Armando Pereira stands accused by Portuguese authorities of fraudulent behaviour and money laundering. The telco group acknowledged the accusations and resulting investigation in a statement in which it presented itself as the victim of any fraud by an individual. However, the ongoing scandal has triggered the suspension of a number of key people connected with the group in recent days.

Whatever the outcome of the investigation, it will doubtless raise some concerns in the UK should Drahi make another move on BT.

For its part, BT is playing it pretty cool about CEO Philip Jansen’s decision, announced a fortnight ago, to step down from his post within the next 12 months. It emphasised that the succession process is already underway and that it’s business as usual in the meantime. That’s all well and good, but the fact remains that BT is without a long-term leader at a time when its highly opinionated major shareholder is again rumoured to be sniffing around.

Ultimately though, this is just another rumour. While a new approach from Drahi is certainly not out of the question, it’s also possible that this story could amount to little more than idle speculation at the start of the summer news lull.

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