Bloomberg News

Iliad’s Niel, Goldman Sachs Said to Team on Orange Swiss Bid

October 21, 2011

(Updates with valuation in second paragraph.)

Oct. 21 (Bloomberg) -- Iliad SA’s billionaire founder Xavier Niel teamed up with Goldman Sachs Group Inc.’s private- equity unit to bid for France Telecom SA’s Swiss mobile-phone unit, according to a person familiar with the situation.

The 50-50 joint offer for Orange Suisse is being made through one of Niel’s personal holding companies, rather than Iliad, the broadband provider in which he is the majority shareholder, the person said, declining to be identified because the talks are private. The Swiss unit could fetch about 2 billion euros ($2.8 billion), people with knowledge of the matter said last month.

Goldman Sachs declined to comment. Les Echos reported earlier today that Niel had bid for Orange Suisse with assistance from the firm.

France Telecom is exiting Switzerland as part of a plan to re-orient its business toward fast-growing markets in the Middle East and Africa. The company this week agreed to buy Congo-China Telecom, the fourth-largest mobile operator in the Democratic Republic of Congo. The Swiss sale has also drawn interest from Egyptian billionaire Naguib Sawiris and private-equity firms including Apax Partners LLP and EQT Partners, people familiar with the matter said last month.

French Competition

France Telecom Chief Executive Officer Stephane Richard today said he aims to sell the Swiss operation by the end of this year. The company is also targeting its Austrian and Portuguese units for disposal. The former French phone monopoly is under pressure at home due in part to Iliad, which is entering the mobile market next year with a pledge to drive down prices that are higher than the European average.

France Telecom shares traded 1.6 percent higher at 12.82 euros as of 3:46 p.m. in Paris. The stock has declined 18 percent this year as competition and regulatory changes cut growth.

Niel, whose stake in Iliad is worth about 2.9 billion euros, has used his fortune to become one of France’s most prolific venture capitalists, putting about 50 million euros a year into young technology companies. This year he and two other French Internet executives, vente-privee.com founder Jacques- Antoine Granjon and Meetic.com founder Marc Simoncini, opened a school in central Paris to train aspiring digital entrepreneurs.

--Editors: Simon Thiel, Robert Valpuesta.

To contact the reporter on this story: Matthew Campbell in Paris at mcampbell39@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net.


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