French telecoms shares have surged on the prospect of an imminent deal between Orange and rival Bouygues as reported by a French newspaper.
French newspaper weekly le Journal du Dimanche has reported Orange has been holding intense talks with the two other French telecom operators – Free and Numericable SFR – about selling them parts of Bouygues’ assets.
That would need to happen for a deal to be approved by competition regulators.
Orange would only say that talks are continuing. “Following various press rumours, Orange categorically denies that any agreement has been reached on a plan to share Bouygues Telecom assets or on their valuation,” an Orange spokesman said.
“Discussions are continuing between the various parties.”
A tie-up would reduce the number of mobile operators in France from four to three and create a new telecoms giant with nearly 50 percent of the mobile and fixed-line market.
French telecoms shares surged on the prospect of an imminent deal.
Shares in Bouygues, Orange, Iliad – which owns Free – and Numericable-SFR all showed significant gains.
“This latest news reinforces our belief that French market consolidation will happen, and Iliad will greatly benefit from it,” analysts at Bryan Garnier wrote in a note.