Altice France, the owner of SFR, has rejected a €17 billion ($19.8 billion) joint offer from French telecom giants Bouygues Telecom, Iliad’s Free, and Orange. The move dampens investor hopes for long-awaited consolidation in Europe’s competitive telecom market.
In a memo to employees, CEO Arthur Dreyfuss confirmed that the proposal, which valued Altice France at around €21 billion, had been “immediately rejected.” The bid’s rejection came after it boosted shares of major telecom firms, with Bouygues hitting a seven-year high before closing 9% higher, while Orange rose 3%. The CAC 40 index also gained 2%, lifted by speculation of industry consolidation.
Despite the rejection, Bouygues, Orange, and Iliad reaffirmed their commitment to the proposal, saying it would benefit “customers, employees, creditors, and shareholders.” Analysts at J.P. Morgan viewed the offer as stronger than expected, estimating SFR’s standalone value at €16 billion but noting potential synergies could lift it beyond €20 billion.
Finance Minister Roland Lescure said the government would be “extremely vigilant” about the deal’s potential effects on prices and service quality. Any merger would need approval from French or EU regulators, given that France has maintained four major mobile operators since 2012.
SFR, the country’s second-largest telecom provider, currently serves over 19 million mobile and 6.1 million fiber customers. Analysts suggest that if consolidation moves forward, it could influence similar restructurings across other European markets.