Tuesday, November 8, 2016

Altice sentenced to a record fine of 80 million euros – Challenges.fr

the competition Authority has imposed on Tuesday, November 8, a fine of 80 million euros for the telecom group Altice to have started before the green light for its merger operations with the operators SFR and Virgin Mobile in 2014.

This decision is “a first in Europe and in the world by the extent of the practices sanctioned and the level of the sanction imposed,” says the authority in a press release.

It is also the first punishment related to the carrying early of a merger notified in France.

“It is as if a builder was to build a building before you even have a permit to build,” pointed out Isabelle de Silva, the president of the gendarme of the competition of which it is the first decision since coming to office.

This decision is both educational, to encourage companies “to be vigilant, not to implement early a concentration, under penalty of incurring heavy penalties”, explained the competition Authority.

Altice risked a maximum fine of 500 million euros, said the body which has carried out visits and seizures in the context of this investigation.

the competition Authority has explained to have determined in favour of a more modest ceiling but nonetheless “highly deterrent”, at the end of a trading transaction, that is to say, an amicable procedure in which Altice has recognized its wrongdoing and, therefore, abandoned any recourse.

The group of billionaire Patrick Drahi has confirmed not to challenge that penalty, to “limit the financial risk linked to this procedure. And, to his credit, he puts forward his “good faith” and an “uncertain legal framework” in the challenged practices, and a willingness “to resume a constructive dialogue with the regulator”.


The authority has estimated its side after its investigation that the crime “was a deliberate nature”.

The title Altice remained virtually unchanged at the Amsterdam stock Exchange after this announcement, taking 0,03% 15,945 € to 12: 45 PM (11H45 GMT), while that of its subsidiary SFR in Paris was up 0.91% to 23,27€.

Altice, which operated in France under the brand Numericable, had managed to take over SFR in march 2014 after a homeric battle against Bouygues Télécom, placing it on the table 13,36 billion euros to buy out a telecoms operator to Vivendi, giving birth to the group SFR-Numericable.

In the wake of this operation – the biggest merger in France in 2014 – the group had also taken control of OTL, which uses the Virgin Mobile brand name.

Numericable and SFR would have had to adhere to a “period of suspension” between 5 June and 30 October, the date of final authorization of the transaction by the authority, during which they had the right to discuss but not to work directly in the merger.

But the policeman had pointed to “a number of indices – mainly from competitors”, which suggests that Numericable and SFR had not waited for the green light.

The authority has cited several examples of early intervention to Altice in SFR: between may and October 2014 with the participation of SFR to a call for bids for a fiber-optic network in Seine-et-Marne was subjected to the agreement of Patrick Drahi.

in October, a major deal-sharing networks between SFR and Bouygues Telecom has been “validated at the highest level”.

The two groups have also begun to prepare for the launch of a new range of offerings of high-speed internet under the brand name of SFR, using the box, the bouquets TV and the network to Numericable. It has been launched as of November 18, less than three weeks prior to the permission.

Finally, the general manager of OTL had begun to exercise its functions in SFR-Numericable prior to the authorization.

This fine is a new setback for the group, Patrick Drahi.

Altice had already been sentenced in April to a fine of 15 million euros for not having respected certain commitments related to the sale of Outremer Telecom, taken in connection with the buyout of SFR.

In addition, the financial markets Authority has rejected the beginning of October a project of public exchange offer of Altice on the SFR, which would allow him to take complete control of the operator. The group has appealed this decision.

(with AFP)


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