France's Bouygues Telecom Substantially Raises its Offer to Buy SFR
Published on: 4th Apr 2014
By: Ian Mansfield
France's Bouygues Telecom has again raised its offer to buy rival mobile network SFR from its owners Vivendi.
Although Vivendi is currently in exclusive negotiations with the French cable operator, Altice controlled Numericable, that has not stopped Bouygues repeatedly lifting its own previously rejected offer.
That exclusivity period is set to end tomorrow, and if Vivendi doesn't announce a deal over the weekend with Numericable, then Bouygues' offer will have to be considered again.
Bouygues has previously said that it plans to merge its own mobile network with SFR and then list the merged network on the stock market.
Under the new offer, Bouygues has proposed to increase the cash element of the offer by EUR1.85 billion to EUR15 billion, without changing the level of debt at the new entity which would retain an investment grade profile. In addition, Bouygues is increasing the total value offered to Vivendi for SFR by giving it a 10% equity interest in the new entity.
Bouygues will invest €850 million in addition to the contribution of its equity interest in Bouygues Telecom and will be the controlling shareholder of the new entity, with a 51% equity interest at closing, alongside Vivendi (10%) and the other industrial and financial institutions (39%).
Bouygues added that the Bouygues Telecom-SFR merger is expected to generate a total of EUR10 billion in synergies.
Bouygues said that the new offer is valid until 25th April.