Investing.com -- A consortium comprising Bouygues Telecom, Orange, and Free-iliad has signed a memorandum of understanding with Altice France to acquire telecom operator SFR in a deal valued at €20.35 billion ($23.44 billion), including debt, Reuters reported on Saturday. The agreement follows months of negotiations between the parties. The consortium had previously extended talks by 48 hours to finalize the transaction after making progress toward a definitive agreement.
Altice France had already prolonged the exclusivity period for negotiations until June 5 after the consortium improved its offer in April from approximately €17 billion. If completed, the transaction would rank among the largest telecom deals in Europe in recent years and significantly reshape France’s telecommunications market. The acquisition would result in the breakup of SFR, with its assets divided among the three buyers.
Under the agreed structure, Bouygues Telecom would receive approximately 42% of the assets, while Free-iliad would take 31% and Orange would acquire the remaining 27%.A successful transaction would reduce the number of mobile network operators in France from four to three, a change likely to attract scrutiny from competition authorities. Regulatory approval is expected to be one of the key hurdles facing the deal. European regulators have historically approached telecom consolidation cautiously amid concerns about reduced competition and higher consumer prices.
Orange Chief Executive Christel Heydemann said earlier this year that the company had already begun discussions with regulators. She indicated that behavioral remedies could be considered as part of efforts to secure approval. The memorandum of understanding also includes break-up fees ranging from €100 million to €2 billion, depending on the circumstances surrounding any potential termination of the agreement.
The deal marks a significant step in Altice France’s efforts to reduce debt and streamline operations. For the buyers, the acquisition offers an opportunity to strengthen market positions and capture additional scale in one of Europe’s most competitive telecom markets. Investors are now expected to focus on the regulatory review process, which will determine whether French and European authorities are prepared to permit further consolidation in the sector.
Comments
This deal could really shake up the telecom landscape in France! It's interesting to see Bouygues, Orange, and Free-iliad teaming up. But I wonder how the regulators will respond to reducing the competition from four to three operators. With so many mergers in recent years, consumer prices could be at risk. Let's see how this unfolds!