TalkTalk has officially accepted a £1.100bn takeover bid from investment firm Toscafund. The British operator and broadband provider has accepted an offer from its second shareholder valuing it at 97 pence per share. The news comes a year after the telco turned down a larger €1.5bn offer from the same suitor who valued TalkTalk at double its share price; however, the company's board has found that it was not providing sufficient value to shareholders and customers.
TalkTalk acquisition confirmed
"I am pleased to have the opportunity to continue to be a major shareholder of TalkTalk," Sir Charles Dunstone, Chairman of TalkTalk, said in a statement to the London Stock Exchange. "My decision underscores my passion for the company and the confidence of the management team and myself in our way forward. That being said, as the UK moves towards full fiber, we have a challenging but exciting opportunity. "Going private would allow us to accelerate adoption and focus on our role as an affordable provider of fiber to businesses and consumers across the country. The telecommunications industry is undergoing a fundamental overhaul and we look forward to playing our part in it." The deal is still subject to regulatory approval, but if granted, it is expected to be completed by March 31, 2021. TalkTalk CFO Kate Ferry will step down as part of the acquisition. control, with Phil Eayres taking her place.
Tosca Offers
News of the proposal surfaced in early 2020, prompting Tosca to comment publicly on the matter. The company said it understands why its offer was rejected and reiterated its support for the current board and management, adding that the company is in a much better position than when it made its offer. Initial offer. However, over the past year, Tosca has increased his stake in TalkTalk from 19% to 29%, roughly the same as chief executive Sir Charles Dunstone. It is not known when Tosca's offer for 2019 was made, but a possible reason for the lower offer could be that TalkTalk no longer has a fiber network. Last year the company said it was seeking up to €1bn to fund the expansion of 'FibreNation', a wholesale alternative to Openreach for TalkTalk, Sky and other broadband providers. However, FibreNation was sold to CityFibre for €200 million in January. Lately there has been a revival of interest from private equity firms in telecom infrastructure due to predictable long-term revenue and margin growth. However, TalkTalk's customer base of four million remains an attractive proposition as the UK market moves towards convergence and the company looks to migrate subscribers from copper broadband to fiber broadband.