Luxembourg-based telecom investor Altice has offered to buy French mobile operator Bouygues Telecom, the companies announced today, potentially activating the country’s long awaited four to three consolidation.
Altice is bidding via its local…
Luxembourg-based telecom investor Altice has offered to buy French mobile operator Bouygues Telecom, the companies announced today, potentially activating the country’s long awaited four to three consolidation.
Altice is bidding via its local subsidiary Numericable-SFR, for a reported €10bn (US$11.4bn).
Bouygues, the parent company of Bouygues Telecom, confirmed the “unsolicited” offer and said its board of directors would meet tomorrow (23 June) to review it. It emphasised that no negotiations were currently underway.
BNP Paribas and JPMorgan have reportedly agreed to provide financing for the deal.
Economy minister Emmanuel Macron, who earlier this month spoke out against in-country M&A, reiterated on Sunday that this “is not desirable for the sector today”. He asked operators to concentrate on investment and innovation, rather than “opportunistic mergers that profit a few but don’t serve the overall good.”
Macron is due to meet Altice chief Patrick Drahi tomorrow, and is reportedly also concerned about the impact of such a deal on this summer’s 4G auction, which aims to raise at least €2.5bn.
Bouygues Telecom is worth €5bn-6bn, according to analyst estimates, while the conglomerate last week had a valuation of €11.3bn.
Infrastructure disposal
Numericable-SFR has separately announced plans to sell some Bouygues assets to Free parent Iliad, assuming the deal completes. This reportedly refers to a disposal of towers and spectrum, a move designed to appease competition authorities.
In March, TelecomFinance reported that advisers were pushing a split of Bouygues, with infrastructure assets going to number four player Free. Such a move would smooth the regulatory path, while increasing the price the buyers could offer for Bouygues Telecom. Founder Martin Bouygues has so far resisted significantly lower offers from both Orange and Altice, and has repeatedly stated he does not want to sell.
France’s mobile operators are all party to network sharing agreements, with Free/Orange on one side and SFR/Bouygues on the other. Bouygues sold 2,166 of its mobile towers to Antin in 2012, reaping €205m.
