Deloitte Resignation Complicates TalkTalk's Future

TalkTalk's financial troubles have intensified following the resignation of its auditor, Deloitte, after 22 years, which cited significant weaknesses in the company's financial controls. Although TalkTalk characterized the resignation as part of a planned rotation, analysts have expressed concern that it may hinder potential takeover efforts, particularly from companies like Virgin Media O2. A recent £400 million refinancing package helped avert immediate default, but the company still faces a hefty debt load of approximately £1.2 billion and high interest rates up to 12.8%. Talks to sell a stake in its Platform X division to Macquarie fell through earlier this year, leading to speculation about the overall viability of the company. The resignation of Deloitte might signal deeper issues that could affect TalkTalk's market position and valuation, as indicated by analyst James Ratzer. Meanwhile, industry regulator Ofcom is reportedly preparing a 'supplier of last resort' plan to protect customers in case of company failures in the sector.