Hot Telecommunication Systems Ltd. (TASE: HOT.B1) owner Patrick Drahi is acquiring SFR SA from Vivendi SA (Euronext: VIV) for €13.5 billion through his company Altice SA (Amsterdam: ATC). Drahi reportedly submitted a bid of $15-20 billion for SFR, France's second largest telecommunications carrier, in order to merge it with his carrier, Numericable SA (Euronext: NUM).
Drahi bid against Bouygues SA (Euronext: EN), which reportedly submitted a slightly lower bid than he did.
Europe is following the developments in France, because mobile market regulation is a key issue at the EU regulator. Regulators want to keep a high level of competition at the expense of carriers' profits. The carriers claim that there is no room for more than three carriers in the telecommunications market, which by its nature is constantly changing and requires heavy investment.
The acquisition of SFR will turn Drahi into a key player in the French market, especially in the landline telephony segment, where he has no activity at present. SFR has a 30% share of France's mobile market, as well as millions of landline customers.
Drahi, who worked with a small number of aides to build a cable and television stations empire from the Dominican Republic to Belgium, met with the French regulator and ministers to explain his plans for SFR, which has 9,000 employees. He ignored the media tumult.
Someone who worked with Drahi for many years praised him for his success in acquiring SFR, "He is someone who is not part of the French establishment. He had to have huge determination to achieve what he has achieved."
Published by Globes [online], Israel business news - www.globes-online.com - on April 6, 2014
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