The prospect of going out of business is slipping away for Kosc. "A business continuity plan will be proposed by Kosc's management and massively supported by Altitude Infrastructure," explains David El Fassy, the president of this group specialising in the deployment of fibre optics in rural areas.

The offer will be placed on Monday on the desk of the receiver, who will have to choose between it and possible disposal plans presented by other candidates, such as Bouygues Telecom, which has long been presented as a potential buyer.

"We propose to maintain the business and the services provided to customers. We are backed by Altitude, an extremely experienced family group used to providing wholesale only services. And we pay the company's liabilities. This is by far the best solution," argues Yann de Prince, Kosc's founding president.

As part of the continuation plan, the debts of 40 million euros would be renegotiated. And an agreement would be sought with SFR to settle any dispute.

The fact remains that the company is burning cash. The former shareholders - the OVH group and Caisse des Dépôts - had agreed to provide 4 million euros at the beginning of December to ensure operations during the recovery phase. The administrator knows that this cash box will soon be empty.

Faced with this cash flow problem, Altitude Infrastructure promises to invest 100 million euros in Kosc over the next five years. A large part of this contribution will be made out of own funds.  "Acquiring new customers is expensive, explains David El Fassy. Kosc's technical infrastructure is now efficient and supplies a lot of companies. Kosc's market is ahead of him. Our business plan foresees a return to operational equilibrium in 2022."

The existence of this continuation plan should reassure Kosc's employees, the dozens of customer operators, the companies that they themselves supply, and also the elected representatives of the Senate and the Assembly, who have taken up the challenge in recent months to criticise the Competition Authority's action on the corporate telecoms market. Indeed, faced with the very unsatisfactory access of SMEs to optical fibre and high prices, in a context of Orange and to a lesser extent SFR domination, the parliamentarians called for the rescue of the Kosc model. The rescue is on its way.

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Source : Les Echos

Kosc Telecom was the solution devised by the public authorities to bring more competition to the business telecoms market. Just three years after its launch, Kosc is expected to file for bankruptcy leaving a slate of 120 million euros.

After the merger with SFR, Kosc acquired part of the activities of Numericable (Completel). Bpifrance had injected 9 million euros and OVH was also a shareholder via a contribution "in industry". The idea was to make Kosc the third man in the lucrative telecom business market, 85% owned by Orange and SFR.

In 2018, Caisse des Dépôts et Consignation had in turn promised to provide 20 million euros to Kosc. It was without counting on a grain of sand: a lawsuit lost to SFR and the threat of having to pay it 20 million euros. For the Caisse, the risk was too high and decided to withdraw from the case, leading to the fall of the telecom operator.

A new game should be played at the helm of the commercial court, with potential buyers. Indeed, the telecoms sector has evolved since 2016 and Free and Bouygues Telecom have in turn launched themselves into the business market. Bouygues' subsidiary would also be a serious candidate for the takeover of Kosc, and would therefore be favoured by OVH.

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Source : Le Figaro

The wholesale-only operator Kosc is in the spotlight. Its president, Yann de Prince, confirmed that there are only a few weeks left to find a solution to his financial problems at his hearing in early October by the Senate.

"As the company had not yet reached operating balance, and could not therefore in principle convince the court of its ability to continue its activity, it was logical that we should proceed, not with a suspension of payment, but with outright liquidation," explained the director of the alternative wholesale operator.

"The process I have initiated gives the company a very short period of time, two months, to try to overcome its difficulties," he said. Yann de Prince mandated the Rothschild investment bank in early September to "find investors or any partner who could help save or take over the company".

"The outcome of the process initiated at the beginning of September is set for the end of October 2019. It may be extended for a further two months. Its main condition is the payment of the next salaries. This payment itself depends on a new commitment by shareholders or the lifting of SFR's seizures. If one or the other does not come true, we will probably no longer avoid the pitfall of liquidation," said Kosc's boss.

Facing serious cash flow problems, the operator has indeed seen its horizon darken considerably in recent weeks. The operator is uncertain following the Competition Authority's unfavourable decision concerning the takeover of Completel's DSL network, previously held by SFR, and the withdrawal of one of its major investors, Banque des territoires.

"Kosc is in a blocking situation at this time. On September 27, 2019, using the ADLC's decision as an instrument in the middle of a discussion process with creditors, SFR proceeded to a protective seizure of the company's accounts and all trade receivables. As a result, Kosc no longer has any liquidity. Bailiffs regularly come to our offices. From the end of October, it will face the problem of salary payments unless our shareholders intervene further," said Kosc's Director of Financial Control and Regulatory Affairs.

It is now time for an emergency. "Kosc's situation is now simple: either in the coming weeks, the shareholders will be sufficiently convinced and will decide to provide sufficient funds to allow the company to regain a certain margin of manoeuvre, necessary for the implementation of a sustainable solution, or the company will be liquidated or sold," explained its president.

Especially since OVH, one of its historical investors, could well play the role of the girl of the air since the telecom activities are no longer a priority for him.
But the operator has no shortage of contenders for its takeover. The operator's president thus stated "Despite a most unfavourable situation, despite the urgency with which these possible partners are asked to position themselves, sixteen[candidates] have already expressed themselves" by specifying that they are mainly industrial partners.

Bouygues Telecom and Iliad could be candidates for this takeover. This information should still be taken on a conditional basis, but it might seem plausible when both operators have views on this lucrative market.

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Source : ZDNet