Orange Group not planning to increase offer for Jazztel

13 Oct 2014

French telecoms giant Orange Group will not increase its EUR3.4 billion (USD4.3 billion) offer for alternative Spanish operator Jazz Telecom (Jazztel), Reuters reports, citing comments made by the former’s chief executive.

As previously reported by CommsUpdate, last month Orange Group made an offer to buy 100% of Jazztel’s shares at a price of EUR13 per share in cash, a figure it estimated represented a 34% premium over the operator’s average closing price in the last 30 days. With the deal effectively valuing Jazztel at EUR3.4 billion, it was noted that Orange Group requires at least 50.01% of shareholders to accept its offer, though at the time of the announcement it noted that it had already secured an agreement to sell from the Spanish telco’s main shareholder and chairman, Leopoldo Fernandez Pujals, who holds 14.5% of the stock.

Now, after reports that some Jazztel shareholders had said they would reject the offer as it undervalued the company, Orange CEO Stephane Richard has argued the takeover bid is a strong offer and played down any thoughts of upping it, stating: ‘I want to be clear: there will be no increase in the price.’ According to the latest report, Alken Asset Management, Jazztel’s second largest shareholder, has said it will not sell its 5% stake at the price offered.

Spain, Jazztel, Orange Group