Shares in Orange and Bouygues opened lower on Friday, declining 3.5% and 2.5% respectively, according to Morgan Stanley's analysis. The move came after reports of a higher takeover offer for SFR, the telecommunications operator that was the subject of an initial bid in October 2025.
Morgan Stanley said the newly reported offer stands at about 20% above the first approach made in October 2025. That elevated bid, however, had not been accepted by Altice France, the seller. Altice France previously turned down the initial offer, and although market commentary had anticipated an improved proposal in recent days, the size of the increase appears to have influenced investor sentiment when it was reported.
Market participants also appear to have treated the news as a trigger for profit-taking in Orange. Morgan Stanley noted that Orange had posted strong returns on both a year-to-date and a 12-month basis, and that some investors may have used the SFR bid development as an opportunity to lock in gains. The firm drew a parallel with the recent behavior of Deutsche Telekom shares over the prior two-week period, where price action suggested similar trimming of positions.
Details surrounding the suggested transaction remain sparse. Morgan Stanley observed that no synergy targets or EBITDAaL multiples have been made public. Altice France has not released financial results since its third quarter 2025 report, leaving limited visibility on the seller's latest performance metrics.
Should the parties reach an agreement, Morgan Stanley said the likely next stage would be an antitrust review, potentially lasting between 12 and 24 months. The prospect of such a prolonged regulatory process is a material consideration for investors weighing the deal's timeline and execution risk.
On fundamentals, Morgan Stanley forecasts that Orange's EBITDAaL will expand at roughly 3% per year in coming years, a pace the firm says is consistent with the European Union telecom sector average.
Summary
Market reaction to a higher, unaccepted offer for SFR drove share price declines in Orange and Bouygues, with limited public deal metrics and the potential for a lengthy antitrust review adding uncertainty.
Key points
- Orange and Bouygues shares fell 3.5% and 2.5% respectively on Friday morning, per Morgan Stanley.
- The new offer for SFR is reported to be about 20% higher than the October 2025 bid but has not been accepted by Altice France.
- If a sale is agreed, an antitrust process of 12 to 24 months is likely, and no synergy targets or EBITDAaL multiples have yet been disclosed.
Risks and uncertainties
- Deal acceptance risk - Altice France has previously declined the initial offer and has not agreed to the higher proposal.
- Regulatory risk - any completed transaction would likely face an antitrust review of 12 to 24 months, extending execution timeline and introducing regulatory uncertainty.
- Disclosure gap - limited public information on synergies or valuation metrics, and Altice France has not published results since Q3 2025, restricting visibility for investors.