SFR's majority owner, telecoms and media giant Vivendi <VIV.PA> said on Thursday it could raise 1-2 billion euros in equity to help fund the deal. Vivendi said the deal would boost its adjusted net earnings per share from 2009.
PARIS (Reuters) - French mobile operator SFR has agreed to buy Neuf Cegetel <NEUF.PA> for around 2.05 billion euros ($2.95 billion) to bolster its investment capacity in high technology, notably fiber optics.
SFR's majority owner, telecoms and media giant Vivendi <VIV.PA> said on Thursday it could raise 1-2 billion euros in equity to help fund the deal. Vivendi said the deal would boost its adjusted net earnings per share from 2009.
Under the deal, SFR will buy the 29.5 percent stake held by trading house Louis Dreyfus in Neuf Cegetel for 34.50 eeurosros per share.
SFR will then launch a cash offer for the shares of Neuf Cegetel held by minority shareholders at 36.50 euros per share, with the 2007 dividend coupon attached.
!ADVERTISEMENT!Vivendi said SFR would fund the transaction through debt, with Vivendi granting a loan under market terms.
To repay the loan, SFR agreed to "considerably reduce dividend payments that it would receive in the next three financial years" the Vivendi statement said.
"In order to preserve its strategic and financial flexibility, Vivendi plans to raise funds of 1-2 billion euros from its shareholders at the appropriate time."
Vivendi said the amount of the capital increase and a precise timetable would depend on market conditions.
Neuf Cegetel shares -- which were suspended on Tuesday -- were expected to resume trading at 0900 GMT. By 0834 GMT Vivendi shares were up 0.48 percent at 31.25 euros.
Neuf Cegetel had net debt of one billion euros at end of June.
(Reporting by Dominique Vidalon; Editing by Quentin Bryar)
