TalkTalk shares jump on buyout offer from investor Toscafund
Reuters
Published Oct 08, 2020 08:48
Updated Oct 08, 2020 11:10
By Pushkala Aripaka
(Reuters) - Britain's TalkTalk (L:TALK) said it has received a preliminary takeover offer from its third-largest investor, Toscafund Asset Management, to take the broadband operator private in a deal that values it at 1.12 billion pounds.
The company's shares jumped 16.4% to the proposed offer price of 97 pence per share by 0908 GMT, making it the top performer of London's midcap index (FTMC) and indicating the market's approval of the premium offered by the asset manager.
TalkTalk said on Thursday that while its board would discuss the proposal with its advisers, its chairman and second-biggest shareholder, Charles Dunstone, had to offer his support for the deal for Toscafund to make any firm bid.
Dunstone owns a 29.86% stake in TalkTalk, while Toscafund holds 29.09%, according to Refinitiv Eikon data.
TalkTalk did not give any more details about the offer or its plans, but said an offer period has now commenced.
The telecom sector in Britain and Europe has seen several deals in recent years amid intensifying competition, including one between Virgin Media and O2 in May. (https://reut.rs/36Gw2Lu)
Though TalkTalk focuses more on the lower cost segment in Britain compared with players such as BT (L:BT) and Sky (O:CMCSA), its sales also suffered during the coronavirus lockdown.
"Having been building in stake in TalkTalk in recent years Toscafund may have not unreasonably decided it could do a better job of managing the assets itself out of the glare of public markets," AJ Bell investment director Russ Mould said.
In July, Sky News reported that TalkTalk had rejected a 135 pence per share offer from the asset manager last year, which would have valued it at 1.5 billion pounds.
TalkTalk went public in 2010 after a separation from former parent Carphone Warehouse.
Barclays (LON:BARC) Bank and Deutsche Bank (DE:DBKGn) are acting as advisers for TalkTalk.
Get The App
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.