Jazztel shares will be delisted from the Spanish Stock Exchanges within two months after Orange won overwhelming support for its offer to buy the Spain-based broadband provider for €13 a share ($14.30).
The France-based operator announced on Jun. 26 that shareholders representing 94.75 per cent of Jazztel's total share capital accepted its offer, and it now has the right to acquire the remaining 5.25 per cent of Jazztel's share capital at the same price. Orange will therefore pay around €3.36 billion for 100 per cent of the company: €3.179 billion for the original offer and an additional €176 million for the remaining shares.
Once the purchase of all shares is completed by around mid-August, Orange said Jazztel's shares would be delisted automatically. The company noted that this move would "enable Orange Spain and Jazztel to build together the most dynamic convergent player on the Spanish market" and said it was "very satisfied with this result".
The Spanish Securities Commission (CNMV) gave the green light for Orange to pursue its bid to buy Jazztel in late May. The France-based operator had already won approval from the European Commission (EC) for the proposed deal after agreeing to certain conditions, including the sale of a fibre network in Spain representing 720,000 homes.
Through the Jazztel acquisition, Orange has previously said it aims to create the second-largest fixed-line broadband operator and "one of the most dynamic players in the mobile segment in Spain", in an effort to drive customer take-up of convergent offers. The transaction is also expected to generate cost savings of around €1.3 billion for the future combined entity, in particular thanks to savings in operational expenditure and investments in networks.
Orange Spain already sells converged bundles of fixed and mobile services under Orange Kangaroo, and in future will hope to improve its standing in a market with a strong heritage in multi-play strategies. For example, Telefónica Movistar sells the quad-play Fusion plans that combine mobile services with fixed voice, broadband and TV, along with value-added services such as data sharing and free access to content.
Yoigo also sells multi-service plans under the Fusion brand as part of an agreement with Movistar, and Vodafone Spain recently launched a converged offer under Vodafone One.
Meanwhile Movistar has also introduced the "quintuple-play" concept to Spain: in May the company launched VeriSure Hogar, a home security service based on machine-to-machine (M2M) communications that subscribers can add to the company's existing Fusion and home broadband plans.
For more:
- see this Orange statement
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