The SFR takeover is stalled: negotiations extended until June 5th

Discussions surrounding the takeover of SFR by the consortium formed by Bouygues Telecom, Iliad and Orange have been extended until June 5, a sign of the strong tensions surrounding one of the biggest upheavals in the French telecoms sector for more than a decade.

Initially, exclusive negotiations were expected to conclude in mid-May after Patrick Drahi accepted an offer valued at approximately €20,35 billion. However, the complexity of dividing SFR's assets, along with numerous regulatory issues, led the parties to extend their discussions.

A historic dismantling of French telecoms

The plan envisions a complete dismantling of SFR among the three competing operators. According to the broad outlines already mentioned, Bouygues Telecom would acquire approximately 42% of the assets, Iliad-Free around 31%, and Orange nearly 27%. The consumer, business, fiber infrastructure, and mobile frequency activities would be divided among the three groups.

The deal would reduce the French market from four to three major mobile operators, a significant transformation for a sector marked by intense price wars since Free's arrival in 2012. French and European competition authorities still need to approve the entire project, a step that is far from certain.

Employment, competition and prices are at the heart of concerns

This potential takeover is already causing significant social concern. SFR's unions fear substantial job losses among the group's approximately 8,000 employees. Some representatives believe that several thousand jobs could ultimately be at risk, despite the commitments made by the acquiring consortium.

From an economic standpoint, several observers also fear a gradual increase in telecom subscription prices if the French market permanently reverts to three operators. Previous attempts at consolidation in the European telecom sector have often been hampered by Brussels precisely for this reason.

Patrick Drahi under financial pressure

The sale of SFR now appears to be a direct consequence of Altice France's financial difficulties, as the company has been heavily indebted for several years. Patrick Drahi's group has undertaken various restructuring measures to reduce a debt that had become massive after a long strategy of aggressive acquisitions.

Even if a final agreement is reached in early June, the process could still take several years before it is fully completed. Between regulatory approvals, competitive arbitration, and asset integration, industry players are already describing the operation as one of "unprecedented complexity" in the recent history of European telecommunications.