ES in BT edged 0.4 per cent higher yesterday as investors continued to warm to the idea of the British telecoms giant splashing out a reported £10bn to acquire either O2 or EE in a move to bolster its foray into consumer mobile next year.
But not everyone was convinced of a successful transaction as short sellers borrowed over 28m shares in the group, a record high for 2014, expecting BT to shed its recent share price gains.
“This does not necessarily mean they are betting against any deals that may be on the cards, but at least suggests they expect to make money by betting against the price rise,” said SunGard’s Astec Analytics market analyst Karl Loomes on the data, which shows short sellers tripled their holdings after deal talks with O2 were confirmed on Monday.
O2’s owner Telefonica and BT confirmed on Monday they were in early stage talks over the British mobile operator, with EE’s owners Orange and Deutsche Telekom understood to also be talking to BT about the sale of their UK network. The groups declined to make further comments yesterday.
Since Monday BT’s shares have risen 4.17 per cent to 395.8p.