Bouygues’ sweetened offer for French mobile operator SFR reportedly includes a break-up fee of between €500m and €1bn in case the deal does not secure regulatory approval.
Last week, the industrial and media group upped its cash offer to merge SFR…
Bouygues’ sweetened offer for French mobile operator SFR reportedly includes a break-up fee of between €500m and €1bn in case the deal does not secure regulatory approval.
Last week, the industrial and media group upped its cash offer to merge SFR with its mobile unit Bouygues Telecom by €1.85bn to €13.15bn (US$18.14bn), showing its determination to win the bidding battle against telecoms holding Altice.
Earlier this month, SFR’s parent Vivendi picked Altice and its cable unit Numericable for exclusive talks until 4 April.
The decision was a harsh blow for Bouygues and its unit Bouygues Tel, the third largest operator behind Orange and SFR, which has seen its already falling market share decline further since Iliad’s Free Mobile made its debut in 2012.
Citing sources close to the situation, French newspaper La Tribune reported that the break-up fee of up to €1bn will be paid to Vivendi if the competition authority rejects the merger between the two mobile operators, or if the required remedies wipe out the €10bn worth of expected synergies.
Bouygues has already agreed to sell its network to Free Mobile for €1.8bn in the case of a deal with SFR, in order to alleviate regulatory concerns.
The regulatory review of a merger between SFR and Bouygues Tel is expected to be more complicated given the significant antitrust implications of a horizontal deal, compared to a combination with Numericable, which is a less direct competitor.
Bouygues and Vivendi declined to comment on the report.
