Vivendi's SFR telecom unit to cut 856 jobs

Wed Nov 28, 2012 11:38am EST
 

By Leila Abboud and Gwénaëlle Barzic

PARIS (Reuters) - Vivendi's SFR telecom unit plans to cut 856 jobs via a voluntary departure plan, it said on Wednesday, as it restructures to cope with tougher competition in France.

Unions swiftly condemned the move as unacceptable given the more than 3 billion euros ($3.88 billion) in profit that SFR should generate this year, and voiced fears that the cuts were a step towards a sale of France's second-biggest mobile operator.

Vivendi is seeking buyers for its telecoms operations in Morocco and Brazil as part of a strategic overhaul the media-to-telecoms conglomerate hopes will cut debt and revive its flagging share price.

Led by longtime Chairman Jean-Rene Fourtou, Vivendi has since the summer been exploring ways to reduce its exposure to investment-heavy telecoms and focus more on its music and pay-TV businesses.

SFR, long Vivendi's cash cow, has been hit by the arrival of a new low-cost mobile player Iliad, triggering a price war in France. Speculation has swirled around Vivendi's plans for SFR, with French media reports suggesting talks were underway on a tie-up with local cable operator Numericable or a sale to Iliad.

TOUGHER MARKET

Stephane Roussel, SFR's chief executive, acknowledged in an interview that interested parties had approached Vivendi about SFR, but said the group was not out searching for a buyer.

"Although there is a broader reflection on telecoms going on in Vivendi, there is no active initiative on Vivendi's part consisting of going to market to find a buyer for SFR," he said.   Continued...