French telecoms incumbent is reportedly in discussions to sell its business in the Dominican Republic to private-equity player Altice for the sum of about €1 billion ($1.35 billion).
According to a report from the UK’s Financial Times newspaper, which cites a source close to the situation, Altice is participating in an auction process being conducted by Orange (Paris, France).
The operator’s Caribbean business also appears to have attracted interest from regional rivals Digicel (Kingston, Jamaica) and Cable & Wireless Communications (UK, London), although both companies have ultimately decided not to bid for Orange Dominicana, according to the Financial Times story.
The paper’s sources also put the enterprise value of Orange Dominicana at about €1 billion.
Altice specializes in the telecoms and media sector and recently bought a substantial stake in French cable company Numericable.
Although the market in which Orange Dominicana operates is home to just 12 million people, the asset could hold an attraction for Altice because of the ‘roaming’ revenues the operator is able to generate through tourists.
Speaking at a Morgan Stanley conference in Barcelona last Friday, Stephane Richard, Orange’s chief executive, is reported to have told attendees that a Dominica Republic sale would be announced in the next few days and that its deal had exceeded expectations.
Orange is one of several large European operators that has been looking to sell non-core assets as a means of reducing debt and raising funds for investment in more critical areas.
For Orange, specifically, this could include the rollout of high-speed fixed-line and mobile networks in its domestic market, where a price war started by new mobile entrant Iliad has led to a fall in earnings reported at Orange, SFR (Paris, France) and Bouygues (Paris, France).
According to the Financial Times, Grupo Leon Jimenes (Santo Domingo, Dominican Republic), a local business, and Latin American telecoms giant America Movil (Mexico City, Mexico) have also been linked with interest in Orange Dominicana.