French Mobile Networks Merger Held Up by Price Differences
Published on: 10th Jun 2014
Note -- this news article is more than a year old.
The potential merger between two of France's mobile networks is behind held up due to a significant difference in valuations of their two companies.
There is reported to be a $4 billion gap between the price that Bouygues Group is seeking for its mobile network and the price offered by smaller rival, Iliad to buy it.
Citing people familiar with the talks, Bloomberg News reported that Iliad, which owns the Free Mobile network has offered just EUR4-5 billion for Bouygues Telecom, far short of the EUR7-8 billion being sought by its owners.
Bouygues Telecom was effectively put up for sale following its failure to buy SFR from Vivendi, and with consolidation in the market both expected, and supported by the government, a merger or some deal between Bouygues Telecom and Free has seemed the most likely outcome.
Bouygues has said that it is in early talks with Orange, but such a deal could face stronger opposition from European regulators. It could be a negotiating ploy to encourage Iliad to raise its offer to avoid a biding war with a much larger rival.