Orange wants to buy the Spanish Jazztel for 3.4 billion euros

by bold-lichterman

Orange has announced that it will launch a friendly takeover bid for Jazztel, a Spanish telecom operator. “The offer would allow Jazztel shareholders to receive 13 euros per share in cash, ie a premium of 34% on the weighted average of the closing prices of the last thirty trading days. […] The purchase price of 100% of the capital of Jazztel would amount to 3.4 billion euros ”specifies the French group.

Several shareholders have already committed to participate in the operation, including Mr. Leopoldo Fernandez Pujals who should contribute 14.5% of the capital, as well as José Miguel Garcia Fernandez, Managing Director, and Mr. José Ortiz Martinez, Secretary General.

Sector concentration

With this acquisition, the Frenchman wants to form the second largest player in broadband, and the first in mobile in Spain. He estimates the possible synergies at 1.3 billion euros, mainly in operational cost reductions and network investments.

Jazztel is the third operator in Spain. In 2013, it achieved a turnover of 1.006 billion euros for a net profit of 67.5 million euros. Its main competitors are Telefónica and Vodafone, both ahead of it in number of subscribers. This announcement comes amid a merger in the Spanish telecoms sector. Last March, Vodafone had acquired the Iberian cable operator Ono for $ 7.2 billion.