BT will spend £400m saving TalkTalk. A quarter is TalkTalk's debt to BT.
BT agreed on 5 October to buy TalkTalk out of administration, the UK insolvency process, the BBC reported.
BT said the deal will cost it £400m. That covers the purchase, fees, TalkTalk's £60m loss for this year and the £100m TalkTalk owes Openreach, BT's own network business, which the BBC said BT will in effect write off.
In 2021 Toscafund and Panta Capital took TalkTalk off the stock market for £1.1bn, Silicon Republic reported. Its retail customers have fallen from about 4 million in 2019 to roughly 1.5 million.
BT chief executive Allison Kirkby told BBC Radio 4 that 2.5 million customers (1.5 million direct and one million through resellers), including emergency services, "might have lost their services if Talk Talk had failed, which it was on track to do." Virgin Media called the deal a "stitch up". The competition regulator has until 19 October to report, and the government keeps the final say.
By BT's own breakdown, £160m of the £400m covers TalkTalk's loss for this year and its debt to Openreach. The reports do not say how much of the rest reaches TalkTalk's lenders.
Sources
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