Bouygues SA share price down, confirms the increase of its bid for Vivendi’s SFR phone unit to 15.8 billion dollars

A spokesman of Bouygues SA confirmed today that the company has increased its offer for the SFR phone unit of Vivendi SA. The cash component of the offer is said to have been raised by Bouygues SA to 11.3 billion euros (15.8 billion dollars).

The statement of Bouygues spokesman was cited by the Wall Street Journal: “Bouygues submitted its reviewed offer to Vivendi Wednesday.” He, however, refused to disclose any more details about the improved bid but explained that the company “will communicate financial details to the market before it opens”.

An eventual merger between Vivendis SFR unit and Bouygues is said to create a mobile carrier that owns over 21 million subscribers, reducing the number of network operators from four to three.

Bouygues SA shared in a statement that it has increased the cash component of its proposal to Vivendi SA by 800 million euros. After the acquisition of SFR by Bouygues, 43% of the new entity will be held by Vivendi SA in comparison to the previous offer of Bouygues. The company is expected to get a 52% majority stake after the merger.

The company also said in its statement, which was cited by Bloomberg: “An IPO of the new entity is planned as soon as the merger is completed, offering Vivendi an immediate opportunity to monetize its interest. Bouygues is committed to facilitate the liquidity of Vivendis interest in the new entity.”

Altice SA, Bouygues SAs main competitor, is said to have made an offer amounting to 10.9 billion euros in cash and assets, which together would estimate Vivendis SFR unit at about 20 billion dollars. One of the companys spokesmen revealed on Wednesday that Altices offer was unchanged.

Vivendi SA refused to make any comments on the situation on Wednesday.

Bouygues SA fell by 0.19% in Paris by 9:37 GMT to trade at 31.96 euros per share, marking a one-year change of +43.41%. The company is valued at 10.23 billion euros. According to the Financial Times, the 13 analysts offering 12-month price targets for Bouygues SA have a median target of 29.00 euros, with a high estimate of 35.00 euros and a low estimate of 21.00 euros. The median estimate represents a -9.45% decrease from the previous close of 32.03 euros.