This week Vivendi SA announced that investment firm Altice, which is currently the largest shareholder of the cable company Numericable Group SA had contacted it in reference to its mobile unit SFR. SFR is considered as the second-largest operator by subscribers in France. People with knowledge of the matter reported that the unit in question has also attracted the attention of the French conglomerate Bouygues SA and Iliad SA.
Pursuing such a deal will allow Vivendi to abandon the plans of an eventual SFR spin-off to the shareholders of Vivendi, which was conceived after a recent strategic review by the company.
According to the Wall Street Journal, one of the people familiar with the matter said: “There have been informal contacts but nothing is very advanced. For now, these are more reflections than negotiations.”
Martin Bouygues, who is currently the Chairman and Chief Executive Officer of Bouygues SA, was asked by reporters at the companys annual result presentation on Wednesday whether he was thinking about making an offer to Vivendi SA about its mobile unit SFR. Mr. Bouygues refused to comment the matter, saying in an interview, which was cited by the Wall Street Journal: “We are following the evolution of the situation in the telecoms industry very closely.” One of the companys spokesmen also declined to comment the issue on Thursday.
People with knowledge of the matter reported that there have been negotiations on and off between Vivendi and Numericable over the past year, but a compromise concerning the price has not been reached. Vivendi SAs mobile unit SFR is estimated by the analysts of Liberum Capital Ltd at about 12 billion euros (16.5 billion dollars).
The telecommunications companies located in Europe have recently been seeking ways to cement their positions, especially considering the fact that high-speed mobile networks expenses constantly rise, and new rules are being imposed on profit sources by European regulators. This is the reason why Vivendis mobile unit is considered to become the apple of discord.
As reported by the Wall Street Journal, Goldman Sachs explained in a note to its investors on Thursday this week: “As competitive pressure accelerates, we argue operator desire to consolidate is growing and believe the French authorities are more open to consolidation.”
Vivendi SAs shares rose by 0.7% in Paris by 8:49 GMT to trade at20.78 euros, raising the companys market value to 27.64 billion euros.
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