French-owned telecommunications company Orange announced today, Wednesday, 27 November that it has reached an agreement with Altice, the company that recently purchased a majority stake in Tricom, for the purchase of 100% of Orange Dominicana, the French company’s only Latin American operation. The parties agreed on an Enterprise Value of US$1.435 billion (EUR 1.1 billion).
The transaction is subject to the approval of the Dominican Telecommunications Institute (Indotel) and the board of directors of the Orange Group that will review it in the week commencing 9 December 2013, says Orange.
Reuters reports today that in recent years Orange has been hit by regulator-imposed price cuts and the arrival in its home market of low-cost player Iliad, which has driven down prices, and knocked the group’s sales and earnings. It is exiting non-core markets. Orange recently announced its interest in entering the Canadian market.
Orange Dominicana was established in 2000 and is estimated to have 38% of the mobile market in the Dominican Republic. The company posted revenues of RD$22.8 billion (EUR 451 million) in 2012 and had 3.4 million subscribers at the end of September 2013. The company employs approximately 1,400 people.
Altice is a Luxembourg-based cable and telecommunications company that recently purchased 88% stake in Tricom, the largest local cable TV operator. Earlier in November, Altice announced that it planned to leverage on Tricom’s quadruple-play platform to continue its television and broadband development as well as moving aggressively to expand Tricom’s mobile offering. The Orange buyout would be a step in that direction.
Upon purchasing the stake in Tricom, Altice CEO Dexter Goei commented earlier in November: “The acquisition of Tricom is an important step in the implementation of our growth strategy of identifying attractive opportunities in markets where we can create value. Altice is already present in the region with Outremer Telecom and Le Cable that offer quadruple-play services in French overseas territories. The combination of these assets will allow us to create sustainable growth and further optimize the efficiency of our international telecoms infrastructure.”
Altice currently owns and operates cable, mobile, DSL and datacenter companies in Israel, Belgium, Luxembourg, the Caribbean, the Indian Ocean, Portugal and Switzerland.
www.orange.com/en/press/press-releases/press-releases-2013/Orange-reached-an-agreement-with-Altice-for-the-disposal-of-Orange-Dominicana
http://uk.reuters.com/article/2013/11/27/us-orange-altice-idUKBRE9AQ09420131127