Not giving up: Bouygues Telecom raises SFR offer

21 Mar 2014

French telco Bouygues Telecom has increased its offer for rival domestic cellco SFR, despite media group Vivendi’s announcement that it had entered into exclusive negotiations for the operator with broadband provider Numericable and its majority owner Altice Group last week. The updated offer comprises EUR13.15 billion (USD18.13 billion) in upfront payment and a 21.5% share in the equity of the newly combined entity. Bouygues has revealed that Vivendi’s supervisory board confirmed the relevance of Bouygues’ previous offer, which consisted of EUR11.3 billion in cash, as well as a 43% interest in the enlarged, newly established entity, but considered the cash part to be insufficient. The cash increase of EUR1.85 million has been attributed to a number of Bouygues’ long-term financial and industrial shareholders, including Caisse des Depots et Consignations (CDC), the Pinault family and JCDecaux, all of whom are looking to acquire an interest in the new business entity. Reuters reports that French state-backed bank CDC would participate in the new bid made by Bouygues, by acquiring 3% of the merged entity. A spokesperson for CDC revealed that the bank would contribute around EUR300 million to Bouygues’ offer. Further, Bouygues confirmed that an initial public offering (IPO) would follow as soon as a merger is finalised giving Vivendi ‘an immediate opportunity to monetise the remainder of its interest’.

As previously reported by TeleGeography’s CommsUpdate, last week Vivendi decided to enter into exclusive negotiations with Altice Group for its telecoms unit SFR, after examining the final offers it received from both parties. Vivendi considers Altice’s offer ‘to be the most pertinent for the group’s shareholders and employees, with the opportunity for effective execution.’ The Altice bid comprises a EUR11.75 billion payment to Vivendi and a 32% share in the equity of the newly combined entity. It also provides Vivendi with pre-determined exit conditions. Further, the Supervisory Board will meet again in three weeks ‘to examine the next steps and to decide if it should put an end to the other options envisaged.’

France, Altice Europe (formerly Altice Group), Altice France (SFR), Bouygues Telecom, SFR