BT is considering a potential takeover of TalkTalk, which is struggling amid financial difficulties and a customer exodus.

No approach has been made as of yet, no talks have been held and bankers have not been asked to draw up takeover plans however.

TalkTalk, which was founded by Sir Charles Dunstone, is the UK’s fourth-largest telecoms group, with about 3.2 million customers. However, the group lost 400,000 customers in the 12 months to February, and last year Dunstone and other shareholders were forced to inject £235m to shore up its finances.

TalkTalk has struggled since it was taken private by Toscafund, a London-based investment firm, in a £1.1bn leveraged buyout that added £527m of debt to the telecoms group’s balance sheet in 2021. It now has about £1.2bn in debt on its balance sheet.

A BT-TalkTalk tie-up would give the combined group control of about 36% of the UK broadband market.

---