BT agrees rescue deal to buy broadband operator TalkTalk

HomeNewsUS & CanadaUKUK PoliticsEnglandN. IrelandN. Ireland PoliticsScotlandScotland PoliticsWalesWales PoliticsAfricaAsiaChinaIndiaAustraliaEuropeLatin AmericaMiddle EastIn PicturesBBC InDepthBBC VerifySportBusinessWorld of BusinessTechnology of BusinessNYSE Opening BellTechnologyWatch DocumentariesArtificial IntelligenceIntelligence RevolutionAI v the MindTech NowHealthWatch DocumentariesCultureWatch DocumentariesFilm & TVMusicArt & DesignStyleBooksEntertainment NewsArtsWatch DocumentariesArts in MotionTravelWatch DocumentariesDestinationsAfricaAntarcticaAsiaAustralia and PacificCaribbean & BermudaCentral AmericaEuropeMiddle EastNorth AmericaSouth AmericaWorld’s TableCulture & ExperiencesAdventuresThe SpeciaListTo the Ends of the Earth EarthWatch DocumentariesScienceNatural WondersClimate SolutionsSustainable BusinessGreen LivingAudioPodcast CategoriesRadioAudio FAQsVideoWatch DocumentariesBBC MaestroDiscover the WorldLiveLive NewsLive SportDocumentariesSite searchHomeNewsSportBusinessTechnologyHealthCultureArtsTravelEarthAudioVideoLiveDocumentariesWeatherNewslettersBT agrees rescue deal to buy broadband operator TalkTalk 38 minutes agoShareSaveAdd as preferred on GoogleMitchell LabiakBusiness reporterGetty ImagesThe UK's biggest broadband provider, BT, has agreed to buy rival operator TalkTalk to save the company from collapse.

The takeover would end of months of speculation over the future of TalkTalk and mean services for its millions of customers will continue as normal.

BT chief executive Alison Kirkby said it provided "a safety net" for those who rely on TalkTalk. The administrator said it also provided certainty for TalkTalk's 900 staff.

However, Virgin Media called the deal a "stitch up" which allows BT to "tighten its grip" over the market. The government has given itself the power to have the final say on the takeover, citing its importance to critical public services.

TalkTalk has 1.5 million retail customers and one million wholesale customers across the UK.

BT's Kirkby told the BBC's Today programme: "Two and a half million customers, including vulnerable households, and key emergency services might have lost their services if Talk Talk had failed, which it was on track to do.

"So BT stepped in as we were the only viable option to take the business forward."

TalkTalk began as a challenger to BT in the broadband market. It was listed on the London Stock Exchange, but was taken over by private equity in 2021.

Since then, the firm has built up debt while losing customers, leaving it unable to pay some of those it owes money to.

The Competition Markets Authority (CMA) will need to approve the takeover, which would give BT greater power over the broadband market.

Tom Smith, a competition lawyer and former legal director at the CMA, said the regulator will be balancing that concern with other considerations.

"When the CMA looks at it, it will look at what would have happened if the deal wasn't going through," he told the BBC.

"If TalkTalk would have exited the market, for example, then really any deal is better than TalkTalk exiting, but then there might be alternative bidders as well that would have been less anticompetitive."

However, the Department of Culture, Media, and Sport (DCMS) has given itself the power to make the final decision on the deal in the name of the public interest once the CMA has made its report.

DCMS has given the CMA until 19 October to deliver its verdict.

Culture Secretary Lisa Nandy 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."

BT has said it will cost the firm £400m to buy TalkTalk.

This includes the amount needed to buy TalkTalk from administration, fees, TalkTalk's £60m loss for this year, and BT effectively writing off the £100m TalkTalk owes BT's Openreach business.