France Telecom-Orange confirmed its intention to sell minority stakes in its newly unveiled strategic plans for 2011-2015.
The company said that, in the longer term, it did not expect to remain a minority shareholder of assets in which it did not…
France Telecom-Orange confirmed its intention to sell minority stakes in its newly unveiled strategic plans for 2011-2015.
The company said that, in the longer term, it did not expect to remain a minority shareholder of assets in which it did not exercise an operational role.
France Telecom holds 35 per cent of Orange Austria and 20 per cent of Portugal’s Sonaecom, which owns mobile operator Optimus. Private equity firm Mid Europa Partners owns 65 per cent of Orange Austria, while Portuguese multi-sector retailer Sonae SGPS owns 53.17 per cent in Sonaecom.
A spokesperson said the minority investment in Meditel in Morocco and Korek in Iraq made over the last year would not be considered for divestment.
France Telecom has divided its plan into a so-called initial adaptation phase (2011-2013), when it will invest in its networks and markets with a view to anticipating new applications and customer needs. In the 2014-2015 period, called the conquest phase, the group will aim to return to sustained growth of both revenues and operating cash flow.
The company said it forecast cumulative CAPEX of about E18.5bn, including E1bn for fibre deployment in France for the 2011-2013 period. In 2014-2015, CAPEX will equal E9.8bn plus E1bn for FTTH development in France.
France Telecom’s target is to reach E45bn cumulative EBITDA in the 2011-2013 period.
It forecasts gross savings of at least E3bn by 2015 in comparison to the cost base in 2010.
The government is pressing ahead with the award of 4G frequencies, the minister of industry and digital economy said after signing a decree to open the process.
The 2.6 GHz frequencies will be divided into four lots to be awarded in October. The 800 MGHz frequencies will be split into 14 lots to be granted at the beginning of 2012.
The minimum price the authorities want to raise is E2.5bn.
Under the terms of the concessions, licence holders will be required to cover 75 per cent of the population within 12 years for the 2.6 GHz frequencies. For the 800 MHz, they will have to cover 98 per cent of the population within 12 years and 99.6 per cent within 15 years.
The deployment in rural areas will also have to come first. There are currently three domestic 3G operators, Orange, SFR and Bouygues Telecom, with a fourth, Free Mobile, due to launch in 2012. All four are expected to bid for the frequencies.
Iliad, the parent company of ISP Free, has raised E500m through its first bond issue.
Credit Agricole, HSBC, Natixis and Societe Generale were joint-bookrunners of the transaction, while BNP Paribas, Santander and WestLB were co-leads.
The bonds, which bear a coupon of 4.875 per cent, will be redeemed at par upon maturity on June 1, 2016.
The company stated: “With this inaugural bond issue, Iliad benefits from favourable market conditions to diversify its sources of funding and extend the maturity of its debt.” Iliad said the issue was oversubscribed with demand of E1.5bn.
Iliad announced 4.661 million subscribers and E509.8m consolidated revenues for Q1.
Telecoms and media company Vivendi finalised its E5bn loan with 17 banks joining in. On April 18, the company announced that the syndicated loan would fund the acquisition of mobile operator SFR’s 44 per cent stake from Vodafone and refinance existing debt. With this new loan the average maturity of the company’s debt rose from four to four-and-a-half years.
Vivendi’s Canal Plus is close to buying a minority stake in the film channels of France Telecom Orange, the two companies having abandoned their plan to create a film JV.
The proposed JV, announced last January, proposed a merger of Orange cine max and TPS Star channels into Orange cine star, which would have offered films and TV series, distributed through the Orange and CANALSAT networks.
Under the new scheme, Canal Plus would buy a minority stake in Orange’s cinema channels, without shared control.
Canal Plus reportedly no longer wanted an independent entity because of the cost of setting up new teams, since it could not use its own staff. Orange was keen on an independent unit as it feared competition issues. As coowner it would share responsibility for fines in the event of any competition breaches.
Under the new scheme, the cooperation would be limited in order to avoid antitrust problems. Both companies declined to comment.
