France’s top cable operator Numericable, owned by Altice, would consider buying Bouygues Telecom, Altice CEO Dexter Geoi said at the Morgan Stanley Technology, Media and Telecoms Conference in Barcelona.
“We see ourselves as the natural buyer (of Bouygues). We have a huge revenue base so there would be big synergy potential,” said Geoi, according to a number of reports.
In April this year, despite last-minute efforts by Bouygues, Vivendi chose Altice as the successful suitor for SFR, France’s second biggest operator, with its offer of €13.5 billion in cash and a 20 per cent stake for Vivendi in the merged entity.
If Altice follows up on what Geoi has said, it is likely to face greater regulatory scrutiny, since the total number of operators in the country would be reduced from four to three. Currently, the operators are Orange, SFR, Bouygues Telecom and Iliad.
Regulators might ask Altice to sell off parts of Bouygues, which is valued at around $5.6-6.4 billion.
The CEO argued that the company would not need a capital increase and the acquisition would not lead to unacceptable debt levels either because there was time to deleverage given regulators usually need eight to 12 months to approve.
Geoi said he is willing to have a discussion with Bouygues anytime: “If on Friday we get a phone call from Bouygues, then why not? We’ll have that discussion. I would be surprised if there is not some effort in 2015 to get French consolidation done.”
Earlier this year, there were various talks about consolidation in the French market, but none worked out because of disagreement over valuation, among other factors.
More recently Orange’s CEO Stephane Richard said he did not see space for four operators in France and that “given the level of investments needed in fixed and mobile roll-out, and upcoming spectrum allocation, we will see consolidation come back to the table again.”