THE Spanish telecommunication company Orange S.A. has made a €3.33 billion bid for the Spanish cell phone and broadband operator Jazztel S.A.
If the bid is successful, Orange would be able to double its market share, in broadband internet, galloping ahead of Vodafone and taking second place, below Telefonica in Spain’s market share.
Jazztel generated rapid growth by offering cheap internet connections, which included television, fixed lines and mobiles.
Orange said that, including stock options given to some Jazztel managers, the offer is worth a total of €3.4 billion – 34 per cent higher than Jazztel’s market price over the past month.
The French owned company said it would issue €2 billion worth of shares as well as subordinated hybrid bonds, in order to finance the purchase. Spain is Orange’s second-largest market, accounting for around 10 per cent of the group’s revenue.
Earlier this year Vodafone in Spain purchased Ono SA, a midsized cable operator, for €7.2 billion.
Smaller players in Germany and Ireland, have also been swallowed up by the larger communications companies.