Orange abandons attempt to buy Bouygues and drags European markets – Jornal de Negócios – Portugal

Even before the deadline limit, fell to the ground the negotiations between Orange and Bouygues, which would have reduced the number of competitors in the French telecommunications market. The consolidation aimed to create a dominant telecommunications operator in the country and end the price war that has been penalizing the banks in the sector.

The outcome of the negotiations is penalize telecommunications companies that, in turn, drag the European markets at its meeting on Monday. The Orange lost 5.49% to 14.55 euros per share, Bouygues sinks 14.17% to 30.16 euros, Numericable plunges 13.78% to 31.435 euros and Altice – owner of PT Portugal – backs 14, 60% to 13.105 EUR. With this the European index of the sector, the Stoxx Telecom, fell 1.08%.

The Stoxx 600 index which includes the 600 largest European listed, fell 0.11% to 332.80 points.

the success of the negotiations before the deadline of 3 April would have decreased the pressure on the Orange, the largest operator in the market, engaged in a price war with Bouygues since the Iliad, led by Xavier Niel, has introduced a service ” low cost “wireless internet in France, explains Bloomberg.

With the failure of the negotiations, the market remains divided between four operators.

Stephane Richard, CEO of Orange, anticipating the impact of low-cost services in your company, met privately with the CEO of Bouygues, Martin Bouygues, with the aim of uniting the two businesses as a response to disruptive input rivals in the sector. This meeting has four years and at the time the case was dismissed by Bouygues.

After a second failed attempt in 2014, the two officials revisited their plans in 2015, having met in November – two weeks after the attacks of 13 November in Paris – to discuss the proposal, says Bloomberg, citing sources close this negotiation process. Between the two common ground was found and negotiations began formally next month, becoming public on 7 December. The parties eventually confirm that stemmed talks next month.

However, a positive outcome has already foresaw difficult with the financial officer of Orange, Ramon Fernandez, anticipating that still take some weeks p ara reach an agreement that would benefit everyone involved.

the aim was to seal the deal in February, when the Orange should deliver. In the absence of progress in the negotiations, the two parties agreed on a new deadline for the end of March

The last effort. – Unsuccessfully – was made last week, and to limit this weekend week. But even before the deadline, Orange and Bouygues narrowed the talks, and investors were informed of the decision on Friday after the close of markets.