BT strikes deal to rescue broadband firm TalkTalk; euro slides amid France debt burden fears – business live

The UK’s culture Lisa Nandy stepped in to intervene in BT Group’s acquisition of TalkTalk, citing risks to public ⁠services and vulnerable customers ‌if the ‌broadband provider’s ‌services were disrupted. She said: Phone and broadband services are vital national infrastructure. If TalkTalk services fail, there is a genuine risk to life and public services – including to hospitals, schools and emergency care. These are unprecedented circumstances that require action now. That is why I am acting with urgency to ensure that impacts on public health, critical national infrastructure and supply to vulnerable customers are fully considered as part of this process. Nandy’s department said it was acting under Enterprise ‌Act powers after BT agreed to acquire TalkTalk out of ⁠administration. This will allow her to consider the wider public interest once the Competition and Markets Authority has reported on competition concerns. She directed the CMA to report ‌back to her by 19 October. TalkTalk’s customers do not need to take any action, and services should continue as normal. Customers will be contacted directly if there are any changes they need to know about. Clive Selley will lead the stabilisation and integration planning of the acquisition, BT said. He was appointed as head of BT’s international business in April, after running Openreach for more than 10 years. Martijn Blanken will take over his role as CEO of BT International, in addition to being CEO-designate of BT’s proposed international joint venture with Verizon. BT estimates the total cash impact of the acquisition at £400m, comprising transaction and administration costs as well as a trading loss of £60m and non-receipt of £100m otherwise due to Openreach. Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy. BT Group has struck a deal to buy TalkTalk out of administration, saving 900 jobs. TalkTalk’s wholesale and consumer arms will be sold to BT on a debt-free basis. BT said the acquisition would cost it £400m. BT said it “recognised the risk to the country, and especially vulnerable customers and key public services, should the company collapse”. BT therefore approached the directors of TalkTalk and offered to step in immediately. By acquiring the business out of administration, BT said it would be providing reassurance for TalkTalk’s employees, its 1.5 million retail customers and its 1 million wholesale customers across the UK. This includes vulnerable households, and connections that support critical national infrastructure providers across health, emergency services, defence, education, transport, banking and government. During the last 12 months, TalkTalk reported revenues of £1.2bn and was loss-making. Allison Kirkby, BT’s chief Executive, said: This is a genuinely unprecedented situation, where millions of citizens and businesses were at risk if TalkTalk had collapsed. BT is the digital backbone of the country, with a presence in every postcode. We have been connecting the nation for generations, stepping up in the moments that matter, and BT acquiring TalkTalk is now the only viable option to keep millions of customers connected and supported. Our immediate priority is to stabilise the business and provide a safety net for the households and businesses who rely on TalkTalk. Once the regulatory process has been concluded, TalkTalk’s customers will benefit from access to the UK’s best network, and the full range of market-leading products and services that BT offers. And, over a period of time, the transaction will create value for all our stakeholders – customers, colleagues, the country, and our owners. TalkTalk, he UK’s fourth-largest broadband company was founded in 2003 by Charles Dunstone as a subsidiary of Carphone Warehouse. It has struggled in the highly competitive telecoms market, with its customer numbers shrinking from 4 million in 2019 to about 1.5 million. In financial markets, the euro sank to a 17-month low amid concerns over France’s debt burden. The currency tumbled more than 0.8% to $1.1161 in Asia, and is now trading 0.5% lower at $1.1192. The Agenda 9am BST: Eurozone Services and Composite PMIs final for September 9.30am BST: UK Services PMI final for September 3pm BST: US ISM Services PMI for September