November 28, 2012 4:28 pm

Telecoms group SFR to cut 850 jobs

A day after France’s unemployment rate hit a 14-year high of 10.8 per cent, SFR, the telecoms operator owned by Vivendi, said it would shed 856 jobs because of cut-throat competition.

France’s second-biggest telephone company by sales, said on Wednesday it planned to cut 1,123 jobs and create another 267, leading to a net loss of 856 positions through voluntary redundancy. It said the cuts were necessary to “save its competitiveness”.

The mobile market in France has been waging a price war since the government awarded a fourth mobile licence in January to Iliad’s Free Mobile. Iliad, controlled by Xavier Niel, the billionaire entrepreneur, has been undercutting rival operators Orange, Bouygues and SFR to gain market share.

Philippe Capron, Vivendi’s chief financial officer, said this month there were “too many players in the French market”. The group signalled in July that it would have to reduce costs at SFR through job cuts.

Union leaders denounced the plan, saying the cost-cutting was aimed primarily at selling off SFR: “Vivendi is sacrificing its workers on the altar of profits to make SFR more attractive and sell it for a higher price.”

Telecoms and media conglomerate Vivendi is reviewing its structure, which could lead to the sales or spin-offs of its three telecoms companies: SFR, Morocco’s Maroc Telecom and Brazil’s GVT.

The group is in talks with Numericable, a French cable group owned by private equity firms Carlyle, Cinven and Altice, regarding a merger of SFR. Naguib Sawiris, the Egyptian telecoms magnate, has also said he is interested in buying SFR.

Copyright The Financial Times Limited 2015. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.

NEWS BY EMAIL

Sign up for email briefings to stay up to date on topics you are interested in

SHARE THIS QUOTE