French telecom firm SFR rejected a buyout bid by three rivals on Wednesday, October 15, as the government and labor unions warned the deal could harm consumers and employees. The crown jewel in billionaire Patrick Drahi's business empire, which stretches from Israel to Britain and the United States, the deal regarding SFR's parent company, Altice France, is under close scrutiny, all while major players in the sector are pushing for larger scale across the European Union.
SFR "immediately rejected" a €17 billion ($19.7 billion) takeover bid from its three main competitors, Bouygues Telecom, Iliad and Orange, Altice France boss Arthur Dreyfuss said. Bouygues Telecom and Orange both said they had "taken note of the decision."
Earlier on Wednesday, Roland Lescure, finance minister in the shaky minority government that was recently named by President Emmanuel Macron, said that Paris would be "extremely vigilant" about "the impact on consumer prices and service quality" if the deal went through.
Altice's competitors had made no secret of their interest, ever since the company had to restructure its €24 billion debt load with creditors earlier this year.
The restructuring, one of the biggest ever in Europe and approved by a Paris commercial court in August, saw Altice's debt trimmed to €15.5 billion but gave creditors a 45% stake in the company. Drahi, who had borrowed massively to amass a telecoms and media empire but has recently been forced to sell some of his assets, will retain a 55% stake.
The debt restructuring has not calmed fears among SFR's workforce of a potential takeover, pushing some labor representatives to contest the plan in court. Tuesday's joint offer could have led to "the elimination of several thousand" jobs linked to SFR, the CFDT union federation said earlier on Wednesday, calling for "concrete guarantees" on job protections, should the company be taken over. SFR employs around 8,000 people.