French telecoms and media conglomerate Vivendi says it has reached a €4.2 billion ($5.67 billion) deal with Etisalat over the sale of its 53% stake in Maroc Telecom.
The transaction still requires sign-off by regulatory authorities but Vivendi (Paris, France) is confident of concluding the sale by early 2014.
The French company describes the deal as a part of its strategy to refocus activities around media and content and away from telecoms.
According to the UK’s Financial Times newspaper, the group will use proceeds from the sale to pay down its net debt, which had risen to €13.4 billion at the end of last year.
In 2012, Vivendi had attempted to sell GVT (Brasilia, Brazil), its telecoms business in Brazil, but abandoned its efforts after failing to attract interest in its asking price of €8 billion.
The company has recently changed tack and said it will retain GVT but look to sell SFR, its French telecoms business, which has been struggling in the face of tough competition from new entrant Iliad (Paris, France).
Over the first half of 2013, Vivendi reported revenues of €10.84 billion, 1.5% less than in the first half of 2012, while adjusted net income fell by 25%, to €845 million.
The company pointed to difficulties at SFR when commenting on the earnings decline, noting that SFR’s first-half revenues fell by 11.3%, to €5.11 billion, compared with the same period of 2012.
Maroc Telecom (Rabat, Morocco), however, has continued to perform strongly, with earnings rising from €284 million to €326 million over the same period.
The company operates the biggest telecoms network in Morocco but also owns subsidiaries across a number of other African countries, where subscriber growth helped to fuel the earnings increase.
Etisalat’s (Abu Dhabi, United Arab Emirates) takeover will help the Middle Eastern operator to bolster its presence in the Africa market.