Government will not block billionaire Drahi’s 18% BT stake

Ministers launched a probe into the deal in May.

Patrick Drahi’s company, Altice, increased its stake in BT to 18% last December (BT/PA) (PA Media)

French-Israeli billionaire Patrick Drahi will not be blocked from increasing his stake in telecommunications giant BT after a national security review ended with no further action.

The company told shareholders that ministers will not demand that Mr Drahi’s Altice sell off part of its nearly one-fifth holding in the firm.

Mr Drahi – a telecoms billionaire and majority owner of auction house Sotheby’s – had increased his stake from 12.1% to 18% last December.

But in May Business Secretary Kwasi Kwarteng chose to investigate the deal under the new National Security and Investment Act.

The Act was proposed by the government of former prime minister Theresa May as a way to stop foreign companies gaining control of vital British firms.

It allows ministers to intervene in acquisitions on national security grounds.

Business Secretary Kwasi Kwarteng investigated the deal under the National Security and Investment Act (Dominic Lipinski/PA) (PA Wire)

BT does a lot of work for the Government, so a foreign takeover is considered a sensitive matter.

But officials have now completed the investigation and will take no further action, BT said on Tuesday.

“BT Group has now been notified by the Secretary of State that no further action is to be taken under the Act in relation to the increase by Altice Europe NV of its shareholding in BT Group from 12.1% to 18%,” it told shareholders.

Mr Drahi and Altice have said they have no plans to make a full takeover bid for BT, but that might change if the situation alters.

The tycoon has quickly become the biggest shareholder in BT, buying his 12% stake in July 2021 before increasing it to 18% before the year had ended.

His ultimate plans for the stake are still unclear, but he clearly sees potential in BT’s future. The business is investing heavily in British infrastructure, rolling out full fibre broadband across the country.