A month-long bidding contest between Altice and Bouygues for control of Vivendi’s SFR telecommunications unit ended on Monday as Vivendi board members accepted an improved Altice offer which gives Vivendi €13.5 billion (US$18.7 billion) in cash plus a 20% stake in the post-merger entity that combines SFR with Altice’s Numericable subsidiary. The decision deals a setback to Bouygues, the third-largest mobile phone service provider in France, which had hoped to combine its mobile operations with those of second-ranked SFR to create the nation’s largest wireless carrier. For Altice, the combination of Numericable’s video and fixed broadband operations with the wireless operations of SFR offers the opportunity for Numericable to recast itself as an integrated service provider. Although a thrice-sweetened rival bid by Bouygues would have given Vivendi more cash up front, a spokesman for the Vivendi board explained that “the bid by Altice/Numericable presents the lowest competition risk” as “SFR and Numericable are not present in the same market segments and their activities are complimentary.” The spokesman further claimed that the Altice deal offers “the highest growth potential, generating the highest value for its customers, employees and shareholders, while best meeting Vivendi’s objectives.” Upon consummation of the transaction, Altice and Vivendi will hold respective stakes of 60% and 20% in the combined entity, with the remaining 20% to be traded publicly. Vivendi will not be permitted to sell its stake during the first year and must give Altice the first option to purchase that stake if and when Vivendi decides to sell. Vivendi will also be eligible for an additional payment of €750 million (US$1.039 billion) if certain performance measures are met. Contingent upon receipt of required regulatory approvals, the parties aim to complete the transaction this fall.