Reliance Industries Limited (RIL), an Indian multinational conglomerate company, is reportedly mulling a potential bid for British Telecom, the UK-based telecom giant, with an aim to take Jio global. RIL is expected to make an unsolicited offer to gain a stake or even claim a controlling share in the telecom company, sources familiar with the matter cited.
The Indian conglomerate company may alternatively propose to collaborate with the optic arm of British Telecom, Openreach, and fund its expansion plan. However, the UK-based company has recently revealed a target to fund its own expansion plans and not rely on a financial or strategic joint venture partner.
As of November 26, 2021, the market cap of the FTSE 100 company was over $20.63 billion. Following the successful reaching of the agreement, it would become the biggest outbound merger and acquisition deal entered by an Indian company.
Sources further cited that the deliberations are early stage and unlikely to occur eventually. Recently, a PE consortium comprising Warburg Pincus and Apax Partners outbid the conglomerate company, which was indicative of the global telecom aspirations of RIL.
For the record, British Telecom is among the biggest telecom and network providers in the UK, with a robust presence across 180 counties. It notably offers IP TV, fiber broadband, mobile services, and television and sports broadcasting. The company’s stock has declined by 53% in five years, touching an 11-year low during 2020-2021.
British Telecom’s spokesperson has seemingly cited that its fiber arm, Openreach, remains a long-term, core, and strategic asset for the company. When asked if it is open to inducting a financial or strategic partner for the fiber arm, the spokesperson revealed its current plans to build FTTP (fiber-to-the-premises) at scale, pace, and at a low cost, despite being open to other value-creating options.