Bharti Enterprises Chairman Sunil Mittal on Monday said the conglomerate's decision to acquire a 24.5 percent stake in BT Group marks a "good, long-term investment" and an "attractive buy", citing the British company's strong portfolio of home broadband, fibre, mobile and enterprise offerings.
Mittal, a telecom industry stalwart, exuded confidence about the investment and business prospects of BT and indicated that while the priority, for now, is to understand the company and the UK market in-depth, "if there are more opportunities in Europe, we will certainly be open to it in future".
On Bharti's decision to buy a 24.5 percent stake in BT Group – a move that would make it the single largest shareholder in Britain's largest broadband and mobile company – Mittal said: "I think this is a very attractive buy… the UK and European telecom companies are trading at low multiples…so given the cash flow expectations of BT, we believe this is going to be a good investment, and it is a long-term investment.
Earlier on Monday, Bharti Global, the international investment arm of Bharti Enterprises, announced it will acquire about 24.5 percent stake in BT Group from Altice UK. Although Bharti did not divulge the size of the transaction, the deal is estimated to be the ballpark figure of $4 billion.
Sunil Mittal's son Shravin Bharti Mittal, Managing Director of Bharti Global, highlighted that this was a "rare opportunity to buy a stake this size".
"BT is exciting for a couple of reasons. It has a perfect combination of a stable cash flow profile from its consumer business, BT business and growth coming through 'Openreach', and our expectation is that there is enough clarity that the management is delivering, there is clarity of vision and clarity on execution, and it is the right time to enter as an investor in BT." "Our belief is that in the coming years, we will see a significant expansion of the cash flow profile, and the timing was rightly suited for us, at the international arm for this investment," he added.
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