Key facts
- BT Group has acquired TalkTalk and its wholesale business PlatformX Communications out of administration.
- The deal saves 900 jobs and aims to protect continuity of service for TalkTalk's 2.5 million customers.
- BT expects a £400 million cash hit in FY27 from the acquisition, including transaction costs, administration costs, working capital, a trading loss, and uncollected Openreach revenue.
- TalkTalk, the UK's fourth-largest broadband company, reported revenues of £1.2 billion in the past 12 months but was loss-making.
- UK Culture Secretary Lisa Nandy intervened, citing risks to public services and vulnerable customers, and directed the Competition and Markets Authority to report on competition concerns by October 19.
BT Group has agreed to acquire the embattled broadband supplier TalkTalk and its wholesale business PlatformX Communications out of administration in a rescue deal that saves 900 jobs. The acquisition aims to ensure the continuity of service for TalkTalk's 2.5 million customers and prevent potential harm to vulnerable individuals and critical public services.
TalkTalk, the UK's fourth-largest broadband company, has struggled in a competitive market, with its retail customer numbers falling from 4 million in 2019 to about 1.5 million. The company reported revenues of approximately £1.2 billion over the past 12 months but was loss-making. The deal with BT ends founder Charles Dunstone's efforts to sell the company, which had been saddled with debt after a 2021 deal to take it private.
BT expects the acquisition to have a £400 million cash impact in FY27, covering transaction and administration costs, working capital, a £60 million trading loss, and £100 million in uncollected Openreach revenue. Allison Kirkby, chief executive of BT, described the situation as "genuinely unprecedented" and stated that the immediate priority is to stabilize the business.
UK Culture Secretary Lisa Nandy intervened on Monday, citing risks to public services and vulnerable customers if TalkTalk's services were disrupted. She has invoked Enterprise Act powers, allowing her to consider the wider public interest after the Competition and Markets Authority (CMA) reports on any competition concerns by October 19.
Administrators at Alvarez & Marsal Europe confirmed that all 900 employees from TalkTalk's consumer and broadband business and PXC will transfer to BT. BT, the UK's largest broadband provider with about 30% market share, stated that both companies will operate separately and continue to compete until the regulatory review is concluded.