By Steve Goldstein
BT Group shares slumped as much as 8% on a report that Sky would invest in Virgin Media O2's broadband plans.
BT Group fell as the Sunday Telegraph said Sky is closing on on a deal to back the fiber rollout, a threat to BT's Openreach.
Virgin Media O2 is a venture between Liberty Global (LBTYA) and Telefonica , and Sky is owned by Comcast (CMCSA). Analysts at UBS say a fiber JV/cable wholesale combined could add more than GBP300 million of EBITDA to VMO2 and was worth more than $3.5/Liberty Global share. The same analysis said BT could lose over GBP600 million of "very high margin" revenue or some 30 pence per BT share.
Sky currently spends some GBP760 million per year on broadband wholesale fees.
Broader European stock markets saw little movement in afternoon trade. The Stoxx Europe 600 edged up 0.1% to 453.22.
U.K. supermarket chains including J Sainsbury rose after the weekend auction for Wm. Morrison , which saw Clayton, Dubilier & Rice, submit the winning bid with a 287 pence per share, or GBP7.1 billion offer.
-Steve Goldstein