BT agrees rescue deal to buy TalkTalk and PlatformX out of administration

Mixed · 2BT has agreed a deal to buy TalkTalk, rescuing the rival broadband operator from collapse. 1 2 Right · 1BT said it acquired TalkTalk and its wholesale arm PlatformX Communications out of administration on a debt-free basis, for an undisclosed sum. 3 Right · 1The Daily Express reports that the deal also covers TalkTalk's wholesale business, PlatformX Communications. 2

Centre · 1The BBC says the deal must be approved by the UK's competition regulator. 1 Centre · 1It would end months of speculation about TalkTalk's future; the BBC says the company had been on the brink of administration because of its debts. 1 Centre · 1TalkTalk has 1.5 million retail customers and one million wholesale customers across the UK, according to the BBC. 1

Mixed · 2City A.M. estimates the deal will cost BT about £400m, from transaction fees, working capital, a £60m trading loss and £100m in uncollected Openreach revenues; the Daily Mirror describes it as a £400million rescue deal. 3 4 Centre · 1Administrators at Alvarez & Marsal Europe said all 900 employees at TalkTalk's consumer and broadband business and PXC will transfer to BT. 5 Right · 1City A.M. reports TalkTalk, founded in 2003, is the UK's fourth-largest broadband company, with reported debts of around £1.4bn and customer numbers down from 4m in 2019; it announced £115m of new facilities in March. 3

Centre · 1BT chief executive Alison Kirkby said the deal provided "a safety net for the households and businesses who rely on TalkTalk". 1 Mixed · 2Kirkby called it "a genuinely unprecedented situation" and said buying TalkTalk was "the only viable option to keep millions of customers connected and supported". 4 3 Left · 1Culture Secretary Lisa Nandy said she had taken urgent action under Enterprise Act powers to intervene in the acquisition, citing the risk of sudden disruption to phone and broadband services affecting hospitals, schools, emergency care and vulnerable customers, and the Mirror says the deal will face a regulatory review because BT and TalkTalk are close rivals. 4

Centre · 1The Evening Standard notes that TalkTalk's connections support critical national infrastructure providers across health, emergency services, defence, education, transport, banking and government. 5 Right · 1The Express says TalkTalk has shared a message with its existing customers, though the content of that message is not given in the coverage. 2