France’s Orange SA said it is considering a takeover bid of the shares it doesn’t already own in Orange Belgium, which would value the Belgium subsidiary at 1.3 billion euros ($1.58 billion).
According to the offer, Orange (ORAN) seeks to launch the public takeover bid at a price of 22 euros per share. The price represents a premium of 35.6% compared to the closing price of Orange Belgium on Dec. 2 and a premium of 49.3% compared to the volume-weighted average trading price of Orange Belgium over the last six months.
In addition, Orange, which already owns a 52.9% stake in Orange Belgium is mulling a delisting of the shares trading on the regulated market of Euronext Brussels.
“This project is part of the continued efforts of the Orange Group to adapt the capital structure of its subsidiaries to their needs,” Orange said in a statement. “The objective is to strengthen the Orange Group’s position in order to allow Orange Belgium to more efficiently deploy its strategy for long-term value creation and to react more effectively to major transformations in the Belgian market through greater financial flexibility.”
In a separate statement, Orange announced that its Board of Directors is also considering the payout of an extraordinary dividend for shareholders of 0.20 euros per share for 2020. The move comes after the French telecoms group received 2.2 billion euros following a French court ruling that ended a long-standing tax dispute. (See ORAN stock analysis on TipRanks)
Shares of Orange have climbed 11% over the past month but are still down 14% since the start of the year. Meanwhile, Wall Street analysts have a cautiously optimistic Moderate Buy consensus on the stock based on 1 Buy rating versus 2 Hold ratings. That’s with an average analyst price target of $14.83, implying that 19% upside potential lies ahead in the coming months.
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