The French civil engineering construction and concessions group has just acquired – via its energy division – 70% of Snef Telecom, which specialises in fixed and mobile networks. This acquisition marks Eiffage’s entry into the market for telecommunications infrastructure. Experts at AURIS Finance, a merger and acquisition consultancy, analyse this new market move.
The announcement was made on 6 May. In a press release, Eiffage announced that it had entered into exclusive negotiations with the Snef Group to acquire 70% of Snef Telecom. The sale is expected to be completed in the second quarter of 2022. “This acquisition will allow Eiffage Énergie Systèmes to enter the fast-growing mobile market, driven by the development of 5G technologies. It will complete Eiffage Énergie Systèmes’ offer and expertise in the industrial and services sectors,” the group said in its press release.
€200 million in revenues in 2021
With this acquisition, the energy arm of the French construction and concessions giant has taken over a major player in the market for telecommunications networks. Founded twenty years ago in Marseille, Snef Telecom currently employs 1,000 people. Although the amount of the transaction was not disclosed, Snef expects to generate revenues of €200 million in 2021. From the outset, Snef has stood out for its expertise in telecommunications: engineering, deployment, maintenance and operation of fixed and mobile networks. Its clients include the four French telecommunications operators: Free, Bouygues, Orange and SFR, as well as international equipment manufacturers such as Nokia, Huawei, Ericsson, and Cisco. The company also works with French local authorities and major retailers such as Auchan and IKEA.
Towards 5G technology
Acquiring this stake enables Eiffage to enter the 5G market and extend its solutions to include telecommunications. Driven largely by the deployment of 5G technology, the network infrastructure market is currently experiencing rapid growth. According to the 2021 French Observatory for the 5G sector (Observatoire 2021 de la filière 5G), spending on 5G in France, including the construction and operation of networks and smartphones, stands at €2 billion for 2020. This figure could rise to between €27.7 billion and €23.3 billion by 2027. There are currently 250 companies active in 5G in France, creating between 6,000 and 8,000 direct jobs. Indirectly, almost 100,000 jobs are involved.
Moving towards sectoral concentration
This market trend will benefit all players in the sector, from equipment manufacturers to operators, including network specialists. The latter will need to be able to quickly provide solutions for the deployment, maintenance and operation of telecommunications networks to equip France with 5G, in line with the objectives of the France 2030 plan. To speed up deployment, large French companies such as Eiffage are positioning themselves on smaller entities that can quickly deliver new production capacity.
Get the support you need
The telecommunications network sector is very dynamic at the moment. SMEs and ETIs are being actively evaluated for acquisition by large groups. Thanks to their sector expertise, AURIS Finance’s specialists can help you with your acquisition or sale projects.
