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TalkTalk will go private on £1.1bn takeover deal

TalkTalk has confirmed a £1.1bn takeover deal by Toscafund and a private-equity investor.

The deal means that the broadband provider will go private. Under the agreement, TalkTalk shareholders will receive 97p per share, which is a 16% premium on shares as of 7 October – when the offer was made.

 “Being a private company would allow us to accelerate adoption and focus on our role as the affordable provider of fibre for businesses and consumers nationwide,” said Sir Charles Dunstone, TalkTalk Chairman.

“The telecoms industry is going through a fundamental reset and we are keen to play our part in it.”

On the news, shares in the group rose 3%. TalkTalk revealed the deal in a trading update, revealing a 13% fall in profits to £122m amid the pandemic.

The chief executive, Tristia Harrison, said: “Our financials have been resilient in the first half, albeit with some impact of COVID-19 on headline revenue and EBITDA.

“Lockdown has taught us that fast, reliable and affordable connectivity is more important than ever, and we have seen excellent network performance despite a 40%+ increase in data usage.”

The group currently has around four million customers.

Ian West, the senior non-executive director at the company, said: “The Independent TalkTalk directors have taken into account the risks associated in achieving TalkTalk’s strategic ambitions and the wide support that ToscaFund would provide in this regard.

“The Independent TalkTalk directors believe, taking into account the advice they have received, that the terms of the cash offer are fair and reasonable, and are unanimously recommending that shareholders accept the cash offer.”

TalkTalk shares are trading +2.78% at 98.93 (1144GMT).

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