Iliad’s bid for Bouygues Telecom said to be insufficient

10 Jun 2014

French telco Iliad (Free) has reportedly made an informal offer of between EUR4 billion (USD5.4 billion) and EUR5 billion to buy larger rival Bouygues Telecom, Bloomberg reports, citing people familiar with the matter. However, Bouygues is seeking around EUR7 billion-EUR8 billion for the unit, leaving the discussions at a standstill. Although Iliad representatives declined to comment on the reports, a spokesperson for Bouygues revealed that ‘all options are on the table’ and noted the company favours a standalone strategy for its mobile unit.

As previously reported by TeleGeography’s CommsUpdate, in May 2014 Orange France and Bouygues separately announced that they were open to potential tie-ups in the French market. Reports in local media suggested that Orange CEO Stephane Richard and Bouygues CFO Philippe Marien met on ‘several occasions’, allegedly to discuss a possible combination of their operations. A month later Orange reportedly hired investment banks Lazard and Credit Suisse to study a potential purchase of Bouygues Telecom; market leader Orange has not yet made a firm decision to go ahead with a bid for its smaller rival, and discussions that began around six weeks ago could still end without a deal.

TeleGeography notes that the potential combination of Bouygues and Free, the third and the fourth largest players in the market, is likely to attract far less regulatory scrutiny than a merger between Bouygues and market leader Orange.

France, Bouygues Telecom, Iliad (Free), Orange France