Orange's Belgian business is looking to acquire 75% of the capital less one share of VOO
After a competitive selection process, Nethys chose Orange Belgium to enter into exclusive negotiations for the acquisition of 75% of the capital minus one share of VO based on a valuation of €1.8 billion for 100% of the capital.
VOO SA is a telecoms operator that owns the cable network in the Walloon region (picture shows city of Namur) and part of the Brussels area. VOO offers a portfolio of fixed and mobile telephony, broadband and TV services.
It had been reported locally that Telenet looked to be the likely victor in the battle to acquire VOO, but it announced last night that it was no longer in the running.
The equity research firm Jefferies commented in a research note: "We repeat our view that any new operator-owner of Voo is likely to intensify competitive pressures for PROX[IMUS – the country's incumbent operator] who is overindexing [outperforming the market] in Wallonia.
"[Orange Belgium] would gain the opportunity to benefit from owner economics for fixed-mobile convergence at least in Wallonia, if at the risk of a 'winner's curse' and heading into potentially major network upgrade capex."
Orange has been in the Belgian market for 25 years. The acquisition will enable it to pursue its group-level strategy, set out in Engage2025, of offering converged services in every market it operates in.
The enterprise value of €1.8 billion for 100% of the capital corresponds to 9.5x EBITDA before synergies are taken into account.
Orange Belgium has little leverage and intends to finance this transaction by increasing its debt, with the support of Orange SA.
The two say that further details will be disclosed at the time of signing the deal.