BT shares surge as telecom giant prepares to defend against hostile offers
- BT bosses hired Goldman Sachs to update defense strategy
- Shares of the telecom giant jumped 6% to 107p
- Analysts see Deutsche Telekom as possible BT contender
Shares of telecommunications giant BT Group jumped today on buyout speculation.
It was reported yesterday that the firm is preparing to defend itself against a hostile offer.
BT shares are up 6 percent to 107.8p in Monday morning trading.
Collapse: Britain’s biggest telecoms group at risk of takeover as value plummets to just over £ 10bn
Britain’s largest telecommunications group is at risk of being taken over as its value has fallen to just over £ 10bn – the lowest since the depths of the financial crisis.
The bosses have hired Goldman Sachs to update its defense strategy against rivals or private equity, Sky News reported.
A rival’s decision to take over the company, which is in charge of the £ 12 billion campaign to roll out super-fast fiber broadband to 20 million homes and which will play a key role in building the UK 5G network, would require government approval.
The belief that BT’s shares are undervalued is a boost to its private shareholders.
Analysts see Deutsche Telekom, which owns a 12 percent stake, as a potential suitor, although it is understood that BT has not received any formal approach. BT did not respond to a request for comment.
Helal Miah, investment research analyst at the Share Center, commented: According to media speculation over the weekend, BT is strengthening its defenses against a takeover as the weakness in the share price highlights the threat of a takeover. potential bidders.
‘No bidder has been identified, but any potential bidder may be drawn to the fact that individual companies such as Openreach are valued much more than the sum of the £ 10 billion shares with potential bidders from the industry. capital investment. Deutsche Telekom is seen as a likely candidate given its 12% stake in BT as a result of the agreement reached several years ago for the EE mobile network.
“This speculation in some ways justifies the current investor’s belief that the company is undervalued, but its current organizational structure suggests that the stock price will not appreciate at the right valuation any time soon,” Miah continued. private company, it may be easier to restructure and unlock value than as a listed company.
“It doesn’t help long-suffering retail investors much, but this speculation can help set a floor for BT’s share price and can give more momentum to management, and even the government.” to regulators to help BT carry out this much needed restructuring. “