What's Happening?
Altice France has rejected a €17 billion offer from Bouygues Telecom, Iliad, and Orange to acquire and divide the assets of SFR, a major telecom operator. The proposal involved splitting SFR's consumer
business and network assets among the three companies, with Bouygues taking 43%, Iliad 30%, and Orange 27%. The offer did not include some of Altice's smaller assets and valued SFR at €21 billion, which is below the €30 billion sought by SFR's owner, Patrick Drahi. The rejection comes amid historical reluctance from EU regulators to approve large mergers that reduce market competition.
Why It's Important?
The rejection of the offer highlights ongoing challenges in the telecom industry regarding consolidation and regulatory approval. While telecom companies argue that mergers are essential for long-term investment and innovation, regulators fear reduced competition could lead to higher prices for consumers. The situation reflects broader industry trends, as seen in recent mergers like Three and Vodafone in the UK. The outcome of this proposal could influence future consolidation efforts and regulatory approaches in the telecom sector.
What's Next?
It remains uncertain whether Bouygues, Iliad, and Orange will revise their offer or return to negotiations. The rejection may prompt further discussions on the valuation of SFR and the regulatory implications of such a merger. Stakeholders will be closely monitoring any updates, as the deal's approval could set a precedent for future telecom mergers in Europe.
