BT Group (LSE:BT.A) has acquired TalkTalk Telecommunications and PlatformX Communications out of administration on a debt-free basis, with the transaction expected to have a total cash impact of approximately £400 million in FY27.
The acquired businesses provide retail and wholesale telecommunications services to around 2.5 million customers. BT said the transaction is intended to maintain continuity of service for those customers.
The approximately £400 million FY27 cash impact includes acquisition consideration, transaction and administration costs, working capital requirements and an expected trading loss of around £60 million. It also incorporates receipts that Openreach would otherwise have received.
TalkTalk’s operations generated approximately £1.2 billion of revenue over the past 12 months but are currently loss-making.
BT said it expects the acquired operations to become value accretive over time as it stabilises and integrates the businesses. This remains a management expectation rather than an established financial outcome.
The transaction remains subject to regulatory review. BT and the acquired businesses will continue to operate separately and compete with each other until that process has concluded.
BT plans to report the acquired operations as a separate business segment.
The group maintained its commitment to a BBB+/Baa1 credit rating and said its existing FY27 and multi-year financial outlook remains unchanged, excluding the effects of the acquisition.
BT said it will provide further financial information later in the fiscal year once acquisition accounting has been completed.
Management Changes Announced
BT has appointed Clive Selley to oversee the stabilisation of the acquired businesses and lead integration planning.
Martijn Blanken will replace Selley as chief executive of BT International. Blanken will also continue as CEO-designate of BT’s planned international joint venture with Verizon.
BT said the acquisition maintains services used by households, businesses and public-sector organisations and reduces risks to service continuity that could have resulted from TalkTalk entering administration.
The company also expects TalkTalk customers to gain access to a broader range of BT network infrastructure and products following integration, subject to completion of the regulatory process.
More about BT Group
BT Group plc is a UK telecommunications and digital services company operating through its Consumer, Business and Openreach divisions.
Its brands include BT, EE and Plusnet, while Openreach operates fixed-access network infrastructure used by communications providers across the UK.
BT is investing more than £40 billion between 2020 and 2030 in areas including full-fibre broadband and 5G infrastructure.
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