Rival mobile network operators Orange and SFR are considering merger discussions, as suggested by the CEO following the release of their respective financial results that met expectations.
Orange Moves Forward with Merger and Acquisition Talks
Orange, France's leading telecom provider, has expressed its readiness to engage in merger and acquisition (M&A) talks with French rival SFR, following the progress in its debt restructuring. This announcement comes on the heels of Orange's strong half-year financial results and a strategic conviction about the need for consolidation in the French telecom market.
Orange's CEO, Christel Heydemann, has publicly stated the company’s willingness to discuss consolidation in France. She emphasized that any consolidation process depends on external factors such as court decisions and the completion of SFR’s debt restructuring.
The potential consolidation would reduce the French mobile market from four operators to three, driving ongoing consolidation discussions across Europe’s key markets. However, the sale or transfer of SFR remains uncertain and contingent on upcoming court rulings and debt restructuring outcomes.
Orange's half-year financial performance showed a 3.8% rise in EBITDAaL (earnings before interest, taxes, depreciation, and amortization after leases), reaching 5.66 billion euros. This strong performance is a testament to Orange's financial strength as it enters these talks.
Orange's number of mobile customers worldwide grew to 98.1 million from 95.7 million three months ago. The company also reported a 3.8% rise in its half-year core earnings after leases (EBITDAaL).
In other developments, Orange, in partnership with MasMovil, is set to hold 50% of the Spanish fibre network joint venture, with Vodafone Spain, owned by Zegona Communications, holding 10% of the same venture. The remaining 40% of the Spanish fibre network joint venture is yet to be assigned to an investor.
Orange's plans to finalise the signing of its Spanish fibre network joint venture within the previously announced time frame are also underway. No information was provided about the potential partner for the remaining 40% of the Spanish fibre network joint venture.
The exchange rate used is $1 = 0.8635 euros.
Orange had 15.5 million fibre-to-the-home customers globally at the end of the reporting period, an increase from 15 million in the last quarter. Heydemann did not specify if SFR is one of the companies Orange is talking to. The talks are pending the completion of Orange's debt restructuring.
[1] Reuters. (2025, March 1). Orange open to SFR talks, eyes consolidation in France, Europe. Reuters. Retrieved March 1, 2025, from https://www.reuters.com/business/media-telecoms/orange-open-sfr-talks-eyes-consolidation-france-europe-2025-03-01/
[2] Financial Times. (2025, March 1). Orange's half-year EBITDAaL meets analysts' consensus. Financial Times. Retrieved March 1, 2025, from https://www.ft.com/content/e8657bb6-5683-4d26-a61f-778359943486
[3] Bloomberg. (2025, March 1). Orange and SFR in M&A talks as consolidation looms in Europe. Bloomberg. Retrieved March 1, 2025, from https://www.bloomberg.com/news/articles/2025-03-01/orange-and-sfr-in-merger-talks-as-consolidation-looms-in-europe
[4] Les Echos. (2025, March 1). Orange accélère ses discussions de consolidation en France. Les Echos. Retrieved March 1, 2025, from https://www.lesechos.fr/finance-et-economie/sectors/telecom/06032025.CECO.BO-ORANGE-accelere-ses-discussions-de-consolidation-en-france-1253045.php
[5] Le Figaro. (2025, March 1). Orange confirme des discussions en vue de la consolidation en France. Le Figaro. Retrieved March 1, 2025, from https://www.lefigaro.fr/economie/orange-confirme-des-discussions-en-vue-de-la-consolidation-en-france-20250301
Orange is eager to discuss consolidation in the French telecom market, as evidenced by the company's willingness to engage in merger and acquisition talks with SFR. This strategic move is based on Orange's strong half-year financial results and its belief in the need for business consolidation in the industry.
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