July 26, 2018 / 9:06 AM / 5 months ago

UPDATE 1-Orange CEO sees a potential telecoms merger in France from 2019

* Market consolidation is unavoidable, CEO says

* Orange could make selective deals in Africa, Middle-East (Adds background, details, other comments)

PARIS, July 26 (Reuters) - Market conditions are likely to lead to a new round of merger talks between France’s four telecom operators from 2019 onwards, said Orange chief executive officer Stephane Richard.

Orange, France’s number one telecoms operator, would not take a leading role in a potential consolidation of the telecoms market, Richard told analysts in a conference call, but would facilitate any deal and could buy some assets.

The former monopoly failed in 2016 to buy smaller rival Bouygues Telecom in a complex deal that also involved the two other operators, Altice Europe’s SFR and Iliad .

The need for major investment in networks and a current price war have sparked interest from all four companies for new tie-up talks, a move that French telecoms and competition regulators would not be opposed to in principle.

“In the medium term, could be from 2019, I still think very strongly that the economics of the French market will make the conditions of a consolidation unavoidable,” said Richard.

“We don’t expect anything in the short term...,” he added.

A quick deal would be difficult given the complexity of any transaction and the peculiarity of the French telecoms market, which opposes three billionaires with strong personalities - namely Martin Bouygues, Altice’s majority owner Patrick Drahi and Iliad founder Xavier Niel.

Richard said Orange was not working on any cross-border deal in Europe, and cited the absence of assets on sale in Portugal and Italy.

Orange, which reported earlier on Thursday higher quarterly profits, could make selective acquisitions in the African and Middle-East region, he added. (Reporting by Mathieu Rosemain and Gwenaelle Barzic Editing by Geert De Clercq/Sudip Kar-Gupta)

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