French cable operator Numericable’s owners, Carlyle, Cinven and Patrick Drahi, are working on an all-cash bid for mobile and broadband operator SFR, reports BFM Business naming no sources. If the private equity groups succeed in their takeover, they plan to merge the two operators. Carlyle reportedly spoke of the plan to Vivendi chairman Jean-Rene Fourtou at a recent meeting but no offer has been made.
The news follows Numericable's discussing last autumn about a possible merger with SFR. The talks stalled but the offer is still on the table, according to Numericable. By selling SFR outright, rather than owning part of a merged company, Vivendi would be executing its declared strategy to refocus on media operations, BFM Business writes. Furthermore, Numericable shareholders who are thinking of selling would find it easier to do so if it is part of a bigger group. Carlyle and Cinven are thinking of raising money on the debt market as Liberty Media has to buy Virgin Media.
An important obstacle is agreeing on value for SFR, worth EUR 23 billion when Vodafone sold its stake in the middle of 2011. Vivendi states that SFR is worth close to EUR 20 billion, while analysts value it at EUR 10-15 billion. Although CEO Stephane Roussel recently said SFR was not for sale, its parent company has different priorities. Neither Numericable nor Vivendi would comment on the matter.
