Discussions between Orange and smaller rival Bouygues Telecom about consolidation in the French mobile market will continue over the holiday period.
Sources told Les Echos an announcement about a deal could happen in early 2016.
The first report of renewed interest from Orange came earlier this month. It said France’s market leader was in early discussions with Bouygues about acquiring its telecoms and media interests with the latter maintaining a minority stake in the business.
Such a combination would face a number of barriers. There has been speculation of renewed interest in Bouygues Telecom from rival SFR-Numericable since its last bid failed in the summer, although the latter denied that possibility.
Political opposition is also possible, although so far it has been muted. Politically, an Orange bid appears favourable to one from SFR-Numericable.
However, any deal would likely face intense regulatory scrutiny, particularly if it lands in front of the European Commission. Likewise, the domestic competition authority would take a long, hard look. Both would want to see evidence that ongoing competition is not weakened by reducing the number of operators from four to three.
A combined Orange-Bouygues Telecom entity would have a mobile market share of more than 50 per cent, according to GSMA Intelligence.