Report: UK Plans to Block Mittal from Increasing BT Stake

• Bharti Enterprises currently holds 24.95% of BT and was reportedly seeking to increase its stake to just below the threshold that would trigger a mandatory takeover offer
• Mittal and Bharti Airtel's Gopal Vittal joined BT's board as non-independent non-executive directors in September
• The UK government's opposition is based on maintaining control over what it considers critical national infrastructure in the telecommunications sector

Summary: UK Plans to Block Mittal from Increasing BT Stake

The British government intends to oppose any move by Indian billionaire Sunil Bharti Mittal to increase his stake in BT Group, citing concerns over maintaining sovereign control of "critical national infrastructure," according to a Financial Times report on May 28.

Key Details:

• Bharti Enterprises currently holds a 24.95% stake in BT, the UK's major telecommunications group
• Reuters previously reported that Bharti was seeking to raise its stake to just below the 30% threshold, which would trigger a mandatory full takeover offer requirement
• A Bharti spokesman stated the company is satisfied with its current holding
• In September, Mittal (founder and chairman of Bharti Enterprises) and Gopal Vittal (vice-chairman and managing director of Bharti Airtel) joined BT's board as non-independent non-executive directors

Market Implications:

The government's opposition signals heightened regulatory scrutiny over foreign investment in UK telecommunications infrastructure, particularly from non-Western investors. This stance reflects growing national security concerns across developed economies regarding control of critical technology and communications assets.

The decision effectively caps Bharti's investment at current levels, preventing further consolidation in the UK telecom sector. This could impact BT's strategic flexibility and limit potential foreign capital inflows. The move follows a broader trend of Western governments imposing stricter oversight on strategic industries.

Status:

Neither BT, the UK government, nor Bharti have officially commented on the report. The regulatory intervention occurs despite Bharti's existing board representation, indicating that even passive minority stakes above certain thresholds may face restrictions in sensitive sectors.