Iliad Drops T-Mobile Takeover Bid

The French telecommunications company Iliad has officially announced that it is dropping its bid to take over the U.S. carrier T-Mobile, according to The New York Times’ Dealbook.

“The Iliad Group announces that it put an end to its project of acquiring T-Mobile US, following exchanges with Deutsche Telekom and selected board members of T-Mobile US who have refused to entertain its new offer,” a company statement said.

The company had submitted an offer to acquire 56.6 percent of the company to T-Mobile’s shareholders, but they rejected the offer. Iliad then formed a consortium of two major banks and private equity funds to increase the offer. The company raised the price to $36 per share and a 67 percent stake, up from $33 a share, but the shareholders again rebuffed the offer.

After this second rejection of the offer, Iliad sounded like a disappointed parent.

“Iliad had the ambition to accelerate T-Mobile US' transformation, notably by saving more than USD 2 billion of cost annually. This transaction would have created significant value for both Iliad's and T-Mobile US' shareholders,” the statement said.

Iliad did not go into detail about what it would have done with the company. Back in its native France, it has gained a lot of success for its Freebox, offered under its Free subsidiary. It’s an ADSL box that not only offers Internet service, but also IPTV, phone service, digital radio and Wi-Fi all over one phone connection.

Perhaps Iliad would have offered a similar “all-in-one” service, but over mobile devices instead of a fixed wireline box.

For its part, T-Mobile will remain controlled by Deutsche Telekom. At the same time that Iliad was attempting to takeover T-Mobile, the company was attempting to merge with Sprint. The T-Mobile/Sprint merger fell apart this summer.

France is a world leader in technology, with the high-speed TGV rail network and being the home of Airbus. The country has also made important contributions to telecommunications.

The Minitel network was one of the first widespread computer networks before Internet access became mainstream. The country also gave Minitel terminals away for free in exchange for phone customers bidding adieu to their paper directories. The service pioneered online shopping and chat years before the term “e-commerce” became familiar, before the service was finally shut down in 2012.