French government ‘ready to approve’ Orange-Bouygues deal

Emmanuel Macron

The French government is ready to approve Orange’s planned acquisition of Bouygues Telecom under a deal that would see parent company Bouygues take a 12% stake in the operator, according to business news service BFM TV.

According to the news channel, economy minister Emmanuel Macron met Orange CEO Stéphane Richard and Bouygues boss Martin Bouygues yesterday to discuss different aspects of the impact of the acquisition, including the state’s 23% stake in Orange. The government’s desire to maintain its stake has been seen as a potential pitfall for any deal.

According to BFM TV, citing unnamed sources, the government has adjusted its position to allow Bouygues take a 12% stake, having previously held our for a maximum of 9% together with a clause in the agreement preventing Bouygues from increasing its stake further.

Bouygues is believed to have set his sites on upping his stake in Orange to 15% and is likely to continue to press for the right to achieve this through the acquisition of shares on the open market. The state, for its part, is unwilling to see its stake fall below the 20% threshold that gives it a blocking vote.

Orange and Bouygues have set a deadline of the end of March to conclude the complex negotiations, which must involve a deal to sell part of Bouygues Telecom’s base and assets to rival players SFR and Free to secure regulatory approval.