Bouygues has delayed a decision on whether to sell its telecoms business to Orange, saying that talks with France’s biggest telecoms operator “had not progressed sufficiently”.
The Paris-based construction and telecoms conglomerate said in a statement on Thursday morning that discussions over the future of the business “had not progressed sufficiently,” ahead of a final decision by the start of next week write the FT’s Adam Thomson and Jennifer Thompson.
A few minutes later Orange released a statement of its own, stating that “negotiations were not yet sufficiently advanced,” and that it will examine the situation again by April 3.
The two groups have been in intense negotiations for several weeks over a potential tie-up that would reduce the number of competitors in France from four to three.
Industry executives and analysts believe that the proposed consolidation would help turn the page on a three-year price war and bring about the conditions required for operators to invest more heavily in the expensive roll-out of fibre and 4G networks.
But people close to the negotiations say that the deal, in which market leader Orange would buy third-place Bouygues Telecom for an estimated €10bn in cash and shares, has been devilishly complex.
From Bouygues’ statement:
At its meeting of 30 March 2016, Bouygues’ Board of Directors noted that the negotiations between Orange and Bouygues had not progressed sufficiently.
Therefore, it will meet before the end of the weekend in order to make a final decision whether to pursue the merger plan or not.
Bouygues had indicated last month it was prepared to walk away from talks with Orange unless it receives a stake of at least 10 per cent of the French operator.