Orange, Bouygues call off merger talks

Orange, Bouygues Telecom

Three months of discussions between Orange and Bouygues about a possible merger have ended in failure.

The two operators announced late last Friday that they were unable to reach a deal that satisfied both parties.

Talks began in January about a possible transaction that would have seen the combined business become the largest mobile operator in France.

In a statement, Orange said: "After in-depth discussions, the Board of Directors of Orange has concluded that an agreement regarding a possible consolidation with Bouygues Telecom has not been reached.

“The decision has therefore been taken to end the discussions with Bouygues that have been ongoing since 5 January 2016.

“Orange will pursue the deployment of its strategic plan, launched in 2015, that is focused on investment in very high-speed broadband networks and providing an unmatched customer experience.”

[Read more: Orange bullish on bank plans, gives itself five years head start on incumbents]

Bouygues said the news ended the possibility of a merger for the foreseeable future.

“In a market where the possibility of consolidation is now ruled out for the long term, Bouygues Telecom will continue its standalone strategy, which has already resulted in a return to growth in sales and EBITDA in 2015,” it said.

“Bouygues firmly believes the telecoms market exhibits strong growth potential, driven by the exponential development of digital uses, and that Bouygues Telecom is particularly well positioned on this market to benefit from this momentum.”

The announcement is a boost to rivals Groupe Iliad and Altice-owned Numericable-SFR.

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