French watchdog warns against telecoms merger: paper

PARIS Tue Jan 15, 2013 3:33am EST

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PARIS (Reuters) - France's antitrust watchdog opposes mergers in the telecoms sector, its head Bruno Lasserre was quoted saying in Le Figaro newspaper on Tuesday.

The comments came days after Iliad (ILD.PA) and Vivendi (VIV.PA) contacted competition authorities about a possible merger of their mobile telecoms units, according to BFM radio reports earlier in January.

Asked whether the watchdog would block a merger between Iliad's low-cost mobile operator Free and Vivendi's SFR, or between Free and Bouygues Telecom (BOUY.PA), Lasserre said:

"I do not have to take sides on cases that are only hypotheses. But I warn against such mergers. A return to three operators is not advisable."

Lasserre however said operators could share their networks to cut costs and cover less profitable areas of the country, adding that the regulator would make a recommendation to the government on all those subjects at the end of February.

SFR, Vivendi's biggest unit, has suffered from the arrival of Free in the market last year.

Vivendi's chief executive said last month the future of SFR would depend in part on whether regulators approved network-sharing deals or mergers, after he predicted the group's future would lie in its content and media business.

(Reporting by Alice Cannet; Editing by David Holmes)

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