SFR Acquisition: Two Heavyweights Position Themselves, Patrick Drahi Can Rub His Hands With Rubbish

The acquisition of SFR could prove more lucrative than expected after the start of a standoff between two major telecom players. An ideal preliminary to the restructuring of Alice France's enormous debt – which should be completed in September.

This is undoubtedly one of the most pressing telecom issues in France. The head of Altice France seems to have resolved to sell SFR – to help restructure the parent company's colossal debt. In total, the group is in the red for €60 billion – including €24 billion for the French branch alone.

With SFR itself in debt to the tune of €15.5 billion, a sale could potentially reduce the amount of debt enough to regain the confidence of creditors and shareholders. It remained to find a buyer willing to accept the size of this debt. And yet, two heavyweights are already fighting to take control of the operator.

Martin Bouygues and Xavier Niel are fighting over SFR

These two giants are Martin Bouygues (Bouygues Telecom) and Xavier Niel (Iliad/Free). With one motivation: to strengthen their position in a particularly competitive market. And above all, to build up a sufficient subscriber base to achieve their ambitions. On one side, Bouygues wants to achieve the critical mass needed to better compete with Orange.

And Iliad dreams of a more international presence, particularly in Europe. Our colleagues at La Lettre de l'Expansion, who broke the story, reveal that operations are already underway behind the scenes. The bids are rising even though nothing has been decided yet.

It's hard to ignore the fact that this would be a lucrative deal for Patrick Drahi, who owns 55% of Altice France. Thanks to the sale of SFR, he could have hoped to pocket up to €5 billion at the end of the restructuring. An amount that now seems within reach, thanks to the arrival of these two players in the arena.

However, it remains for the authorities to decide, both in France and in Brussels. The restructuring of the Altice group, still underway, should be completed by the end of the summer, in September.