An acquisition of Bouygues Telecom by incumbent Orange must ensure continued competition in French telecoms, Arcep president Sebastien Soriano has said. The head of the sector regulator said the mooted €10bn cash-and-share deal must not “lead to further consolidation of Orange’s market share”.
An acquisition of Bouygues Telecom by incumbent Orange (EPA:ORA) must ensure continued competition in French telecoms, Arcep president Sebastien Soriano has said.
Speaking to local newspaper Les Echos, the head of the sector regulator said the mooted €10bn cash-and share-deal must not “lead to further consolidation of Orange’s market share, especially in markets it already leads” such as business clients and rural areas.
Promising there would be “red lines”, he declared that he did not want the sector to go “backwards”, thereby hurting consumers.
It is likely that l’Autorité de la Concurrence will review the possible four-to-three deal, but this will depend on the portion of the French incumbent’s revenue coming from its home market in its upcoming results. If the French competition does have jurisdiction, it would ask Arcep for its view of the potential market impact.
In the newspaper interview, Soriano referred to Arcep’s “direct veto powers on operators’ frequencies,” adding that it could block what it saw as an uncompetitive transfer.
Orange is expected to seek asset disposal arrangements with rivals SFR and Iliad to win over regulators.
French economy minister Emmanuel Macron, who had publicly spoken out against Altice’s €10bn offer acquisition of Bouygues Telecom last summer, has softened his stance on consolidation after raising €2.8bn (US$3bn) in a spectrum auction last November.
The French state holds a 23% stake in Orange.
Speaking to the Financial Times last June, Orange CEO Stéphane Richard said: “I would not say that the shareholder is a frustrating shareholder that opposes every kind of move that we want to do. But, of course, from time to time it makes things a little more complicated.”