Orange has launched a takeover bid worth €3.4 billion ($4.4 billion) for Jazztel, the Spanish fixed operator and MVNO, as it strives to fill out its quadplay offering to match rivals Telefonica and Vodafone.
If Orange’s offer is successful then it will create Spain’s second-biggest fixed broadband operator and strengthen the operator’s position in the mobile market, where it is in third spot.
The Jazztel bid follows Vodafone’s acquisition of Spanish cable operator Ono in July as operators move to snap up fixed assets.
It is also the biggest takeover bid by Orange for nearly a decade, although it does not come as a total surprise as Federico Colom, Orange Spain’s finance director, confirmed an earlier interest in Jazztel earlier this month.
Orange’s €13 per share cash offer for 100 per cent of Jazztel’s capital is a premium of 34 per cent over the stock’s volume weighted average closing price over the last 30 trading days, said Orange.
The offer is conditional upon its acceptance by at least 50.01 per cent of Jazztel’s capital, excluding leading shareholder Leopoldo Fernandez Pujals with 14.5 per cent of the capital, who has already backed the bid.
Other members of Jazztel’s board, CEO Jose Miguel Garcia Fernandez and General Secretary Jose Ortiz Martinez, have also agreed to the offer.
Orange’s bid follows Jazztel’s own statement last week that it was in discussions about acquiring TeliaSonera’s majority stake in Yoigo, Spain’s smallest operator. The Yoigo bid is now on hold, according to Orange, which has no interest in acquiring its smaller rival.