Neuf Cegetel reports 3Q results

8 Nov 2007

French telco Neuf Cegetel has published its results for the three months ended 30 September 2007. Revenues increased 20% year-on-year to EUR859.1 million (USD1.257 billion), boosted by the acquisition of ISP Club Internet from German incumbent Deutsche Telekom in June. The number of broadband subscribers rose by 135,000 in the third quarter, to 3.167 million, while monthly average revenue per user (ARPU) for the quarter rose by EUR3.8 year-on-year to EUR34.50.

Meanwhile, French daily Les Echos reports that the merger talks between Neuf and fellow ISP Iliad were abandoned after leading shareholders, Vivendi and businessman Xavier Niel, failed to agree on who would control a combined group. The newspaper did not name sources, but said that discussions on a merger had begun early on in 2007 based on an all-share deal, and broke down when Vivendi, which owns 40.5% of Neuf via mobile unit SFR, refused Niel’s terms. Niel, who founded Iliad and owns around two-thirds of its stock, wanted a third of a merged group to give him a blocking minority, and wanted Iliad to control the new company’s management. Despite this, Les Echos’s source said the project was ‘not completely dead’.

According to TeleGeography’s GlobalComms database, Neuf Cegetel is the country’s second-largest broadband provider behind incumbent France Telecom, with a 21% market share of subscribers mid way through 2007. At the same date, it also had close to two million fixed line telephony customers. A merger with Iliad would have given the new firm around 42% of the ADSL subscriber market, compared to France Telecom’s 46% slice.

France, Iliad (Free), neuf Cegetel