BT in talks over sale of 26% stake in Cegetel

By Our City Staff
Friday 15 November 2013 06:14
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BT Group said it was in talks with both the mobile phone giant Vodafone and the Franco-American Vivendi Universal yesterday about the possible sale of its 26 per cent stake in French telecoms group Cegetel.

Pierre Danon, Chief Executive of BT's retail arm, said: "Both of them are now showing some interest for our share." Speculation has been mounting that Vodafone and cash-strapped Vivendi, which controls Cegetel through its 44 per cent stake, might try to outmanoeuvre each other in an attempt to raise their stakes in France's second biggest telecoms group.

Vivendi is keen to clinch a majority so it can tap the cashflow of Cegetel's mobile business SFR. Vodafone, which owns 15 per cent of Cegetel and an indirect and direct 37 per cent of SFR, has also made no secret of its desire for control in the key French telecoms market.

BT is hoping that despite languishing prices for telecoms assets, in a market that has seen share prices plunge 80 per cent since March 2000, it will be the winner of any bid battle.

Mr Danon said: "We don't want to disclose our expectations ... but certainly it is trending in a positive direction." Mr Danon said in June that BT estimated the stake was worth around five billion euros. More recently, analysts have valued the holding at nearer to 3.7 billion euros.

However, the market brushed off hopes of an imminent cash injection and pushed BT's shares down 5.75p to 184p. Vodafone fell 0.75p to 85.75p.

Industry sources familiar with the talks said that if any offer met expectations, BT might reach a preliminary deal to sell its stake before Vivendi's key board meeting on 25 September. The media giant, which is struggling to cut heavy debts, is expected to outline its new strategy on that day.

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