BT has reintroduced its dividend and accelerated its cost-savings plans to protect itself against a potential takeover by its largest shareholder.
In its results for the six-month period ending September 31, the telecoms group declared an interim distribution of 2.31p per Share.
Its return will be hailed by BT’s cash-starved shareholders, who have waited 18 months for a payout after the company scrapped dividends to fund its fibre broadband expansion.
Payouts: BT declared a 2.31p interim dividend in its results for the six-months to September
BT also targeted £2billion in cost savings by 2024, a year earlier than planned, following news earlier this week that it had achieved £1billion in savings 18 months ahead of schedule.
The dividend will be returned, along with cost-savings and the elimination of Openreach partners, as BT tries to strengthen its defenses against a possible takeover by Patrick Drahi, a French billionaire who holds a 12.1 percent stake through his company Altice.
Robey Warshaw, an advisory firm, was brought in by the firm last week to help with any potential bids.
Altice purchased its stake from Drahi in June. Drahi made a promise not to make an offer for BT, but this commitment expires at the end of December 10. He could make an approach before then.
Weakness in BT’s share price, which has fallen by 25 per cent since Altice bought its stake and is 70 per cent lower than six years ago, has increased talk of a bid.
This move would be a shock to BT which is due for Adam Crozier, ex-boss at Royal Mail, to become chairman on December 1.
The developments accompanied results for the period which saw the company’s profits drop 5 per cent to £1billion, mainly due to higher costs, while revenues fell 3 per cent to £10.3billion.
Chief executive Philip Jansen said the company is ‘on track’. Shares rose 11%, or 15.65p, at 157.8p