Orange makes move for Bouygues Telecom - reports

Orange makes move for Bouygues Telecom – reports

16 MAY 2014

Orange is in talks about buying smaller rival Bouygues Telecom according to a number of media reports, as France’s mobile market heads towards consolidation with the backing of its government.

Bouygues chief financial officer Philippe Marien said on a Q1 conference call that the country’s third-largest operator is exploring tie-ups with its peers without giving out names.

“All market operators are looking at hypotheses, opportunities, work sharing, partnerships and commercial exchanges., said Marien, indicating options other than a takeover might also be on the agenda.

The company told Mobile World Live that it was “attentive to the changes taking place” in the country’s telecoms sector. “These changes are forcing all market operators to think about all the possibilities and opportunities,” it said, while not actually confirming talks with Orange. It also argued that it could maintain its standalone status should it wished.

Meanwhile Orange issued a statement saying it “is assessing the opportunities that the changing landscape in the French telecommunications [market] might offer” without identifying potential partners.

But, according to Les Echos, Orange is studying a bid that would value its smaller rival at more than €6 billion in an equity-based deal which could leave Bouygues and shareholder JC Decaux holding near 10 per cent of Orange.

Meanwhile French economy minister Arnaud Montebourg confirmed Orange-Bouygues talks are happening but said they might not be the only game in town.

According to Reuters, Orange might be using the talks to lure Iliad – owner of fourth operator Free – to the negotiating table with Bouygues.

Iliad also announced results showing first quarter 2014 revenues hit nearly €370 million, a jump of 26 per cent over 2013, an indication of how the newcomer has bitten into the incumbents’ share.

End-March subscribers were 8.64 million, up from an end-December 2013 figure of just over 8 million. No profit/loss figures were given.

The current spate of talks is the fallout from Vivendi’s decision to sell its SFR mobile unit to French cable operator Numericable and its parent Altice.

And neither is Altice standing still since the deal, with the announcement that it has entered into exclusive talks with Omea Telecom, the owner of French MVNO Virgin Mobile with an eye on a takeover with an enterprise value of €325 million.

Omea Telecom is 46 per cent owned by Carphone Warehouse, the same by the Virgin Group and eight per cent by management.

SFR (now owned by Numericable), as well as Bouygues were previously linked to bids for the French MVNO.


Richard Handford

Richard is the editor of Mobile World Live’s money channel and a contributor to the daily news service. He is an experienced technology and business journalist who previously worked as a freelancer for many publications over the last decade including...

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