BT to buy broadband supplier TalkTalk in £400m rescue deal, saving 900 jobs

BT has agreed to purchase the broadband supplier TalkTalk out of administration in a £400m rescue deal, which will save around 900 jobs. This move will add 1.5 million UK retail broadband customers to BT's portfolio, leading to a regulatory review by the Competition and Markets Authority (CMA). The deal is expected to cost BT £400m in transaction and administration costs, working capital, a £60m trading loss, and £100m in uncollected Openreach revenue.

Lisa Nandy, the secretary of state for digital, culture, media and sport, intervened in the process to ensure that impacts on public health, critical national infrastructure, and vulnerable customers are considered. TalkTalk has approximately 250,000 vulnerable customers, including elderly and disabled individuals who rely on telecare devices connected to the copper network.

In 2023, two vulnerable individuals died when their devices failed during a switch from copper to digital landlines. Virgin Media O2, another rival to BT's Openreach, criticized the deal as a "stitch-up" and raised concerns about further consolidating BT's dominant market position. The UK competition watchdog has also raised substantial concerns over nexfibre, a joint venture between VMO2's owners Liberty Global and Telefónica, and InfraVia's attempt to acquire Netomnia.

BT, the UK's largest broadband provider with about 30% market share, sees this acquisition as a last resort to stabilize the business and protect the households and businesses relying on TalkTalk services.