French finance chief OKs SFR's takeover of Neuf Cegetel

French Finance Minister Christine Lagarde has approved a proposed takeover of telecommunications operator Neuf Cegetel by Vivendi's mobile phone arm, SFR, an Associated Press report said.

The Associated Press report, quoting the ministry said under the deal, announced in December, SFR would boost its presence in the fast-expanding broadband market by buying commodity trading group Louis Dreyfus' 29.5% stake in Neuf Cegetel.

SFR already holds 40.5% of Neuf Cegetel which had said the purchase of the Louis Dreyfus stake was subject to approval from antitrust authorities, the report said.

The €4.4 billion (US$6.96 billion) deal would combine France's No. 2 mobile operator with its No. 2 broadband provider, reshaping the country's telecom landscape as companies have begun to invest heavily in rolling out next generation fiber-optic networks to give consumers access to ever faster Internet connections, the report said.

The deal takes telecommunications and entertainment giant Vivendi, which owns 56% of SFR, a step closer to taking full control of Neuf Cegetel to create an integrated telecom provider in France to rival the country's dominant France Telecom, the report further said.