Vivendi agrees €17 billion SFR sale to Altice/Numericable

Vivendi has agreed to sell French telco SFR to Altice/Numericable, which has fended off competition from rival bidder Bouygues to clinch a deal worth “in excess of €17 billion”.

Confirming the agreement, Vivendi said that the Altice/Numericable offer delivered the highest value for SFR’s customers, employees and shareholders.

Vivendi will receive €13.5 billion at the closing of the transaction, a potential earn-out of €750 million and has the possibility to sell its 20% stake at a later stage – representing a total value that it said is greater than €17 billion.

“This balance between cash upfront and future upside from industrial value creation fits with Vivendi’s philosophy, an industrial and financial group concerned about creating long term value in the interest of shareholders, employees and consumers,” Vivendi said in a statement.

Among the factors that contributed to the decision, Vivendi said that Altice/Numericable’s focus on fixed and mobile convergence would produce strong synergies from the merged networks and generate new growth opportunities.

It also said that the plan presented by Altice/Numericable guarantees “development of sustainable employment” and that the Altice/Numericable offer presented “the lowest competition risks.”

“Vivendi selected the most balanced offer between cash upfront and stock participation allowing the group to benefit from the highest total valuation. While pursuing its announced strategy to focus on media, Vivendi wants to support SFR, its 27 year-long subsidiary, by strengthening its industrial and social structure,” said Vivendi.

The news comes a week after Bouygues extended its improved offer to acquire SFR until April 25. Its bid included a €13.15 billion upfront payment, and offered an indemnity payment of €500 million in the event that France’s competition regulator blocked a deal between the pair.