Ambitious telecoms player Altice is reportedly again looking at a deal to acquire France’s number-three operator Bouygues Telecom, reigniting the consolidation game in the market.
According to Bloomberg, Altice is examining the potential financial and regulatory obstacles to a deal, which would see it owning Bouygues alongside its existing French business, SFR. While this would mean that the number of infrastructure-owning operators is reduced, similar moves have already taken place in other European markets, including Germany.
However, it was also suggested that with France’s economy “barely growing”, integration of the two businesses could be a “delicate challenge”. Job cuts, in particular, are likely to be a thorny issue.
Late last year, Dexter Geoi, CEO of Altice, said that his company was the “natural buyer” for Bouygues. Xavier Niel, head of Iliad, the smallest player in the market, recently said that his company are “not buyers” at the moment.
But any deal between Bouyges and Altice/SFR is likely to entail some regulatory bargaining, and having Iliad on-side to take on some assets may make the path easier. Indeed, Niel is aware of this, arguing that “the market’s consolidation cannot happen without us”.
Altice has also showed itself to be something of a dealmaker in the last year. In addition to acquiring SFR, it is in the process of acquiring the assets of the former Portugal Telecom from Oi of Brazil.
Iliad’s Niel is also no stranger to a deal. He has agreed a deal to buy Orange Switzerland from its private equity owners, and last year made an audacious (but failed) bid for T-Mobile US.