France grants conditional approval to Numericable, SFR deal

28 Oct 2014

France’s competition authority, the Autorite de la Concurrence, has granted a conditional approval to Numericable’s proposed acquisition of domestic telco SFR, following an in-depth investigation of the deal. The anti-trust regulator said that in order to receive its unconditional approval, the combined SFR-Numericable entity has to divest its mobile operations in the French overseas territories of Reunion and Mayotte, while Numericable’s DSL network must be offloaded to business-to-business infrastructure-based telecoms company Completel. Further, SFR-Numericable must allow rival operators to access its cable networks temporarily, in order to enable internet service providers (ISPs) to replicate its retail offerings while they develop their own high-speed broadband networks. The Autorite de la Concurrence said that it was the first time such a condition was imposed in Europe. ‘These commitments are made for a period of five years, renewable once, and their application will be under the supervision of an independent trustee approved by the Competition Authority’, the watchdog said in a press release. Bruno Lasserre, chief of telecoms watchdog Autorite de Regulation des Communications Electroniques et des Postes (Arcep), described the imposed conditions as ‘credible, demanding and ambitious’.

As previously reported by CommsUpdate, on 5 April 2014 SFR’s parent Vivendi accepted a takeover offer for the telecoms unit from cable group Numericable, itself majority owned by Altice Group. The two sides signed a definite merger agreement covering the tie-up of their respective subsidiaries in June, following the successful completion of negotiations with the Employee Works Councils. Vivendi will receive EUR13.5 billion (USD18.36 billion), excluding adjustments, and will retain a 20% stake in the newly merged business entity, which it can sell at a later stage, following the expiration of a one year lock-up period. As Numericable’s purchase of SFR would create the second-biggest player in the French market and ‘raises serious competition concerns’, the anti-trust authority launched an in-depth investigation of the proposed deal in July 2014. During the second phase of the investigation the authority engaged in extensive consultations with stakeholders in the marketplace, while also taking into account the opinion of Arcep and the Conseil Superieur de l’Audiovisuel (CSA).

France, Mayotte, Réunion, Altice France (SFR), Arcep, SFR, Telco OI Mayotte (Only), Telco OI Reunion (Free)