TalkTalk has agreed to sell its business services division to a group of its own shareholders for £95m as the company gets its separation plan underway.
There had been much speculation that the B2B division would sell to a rival, with both Sky and Daisy Group in the frame for a deal valued by Sky News at a potential £200m, including the sale of TalkTalk’s wholesale services. In the end, however, it was TalkTalk’s own shareholders that stepped up.
The telco revealed that TFP Telecoms, a special purpose vehicle controlled by its main shareholders, has acquired TalkTalk Business Direct from the group. The transaction also involves a long-term exclusive wholesale agreement with TalkTalk’s wholesale platform worth c.£25m over three years.
“The transaction delivers both investment for growth for Business Direct, as well as a long-term revenue agreement for our wholesale platform,” said outgoing TalkTalk CEO Tristia Harrison. “This is good news for customers and colleagues alike, and is an important first step in our demerger plans.”
TalkTalk is set to split into three operationally distinct entities – TalkTalk Consumer, the Wholesale Platform, and TalkTalk Business Direct – as of November 1, followed by a legal split on 1 March.
In the end, the sale of the business raised less than media reports had suggested. When it reported Sky’s interest in the unit in August, the Sunday Times speculated on a £150 million price tag, but Sky News had previously plumped for a £200 million valuation.
