European telecom company Altice has made an offer to buy France's Bouygues Telecom on Monday. Bouygues will hold a board meeting Tuesday to discuss the bid.

On Tuesday, Bouygues said that its board would meet to discuss Altice's 'unsolicited offer'. The company added that negotiations between the two sides were in progress and Altice will update the market sooner or later.

Although both the parties didn't disclose the size of the offer, sources told Reuters that Patrick Drahi, the controlling shareholder of Altice, had submitted a bid in recent weeks worth around 10 billion euros ($11.3 billion) in cash.

The offer has cheered investors as the merger is likely to generate billions in cost savings and calm a brutal price war that has raged in France since 2012 when low-cost operator Iliad's (ILD. PA) entered the mobile market.

Bouygues Telecom is valued at 5 and 6.5 billion euros by the analysts. This makes Drahi's 10 billion euro bid a generous one for a company that has been posting losses since Iliad's assault on the mobile market.

Before the latest offer was made public, the entire market value of the Bouygues conglomerate, which includes businesses in roads, construction, television, as well as telecoms, stood at 11.3 billion euros.

Acquisition of Bouygues would pave the way for Numericable-SFR to reap massive cost savings. It will cut staff and rationalize stores, among other measures.

However, Drahi and Altice need to overcome political issues as the French government has already signaled its opposition to the proposed deal, citing concerns over its impact on investment in communications infrastructure and employment.

Shares in Altice and Numericable-SFR were up 21% and 15% respectively by 0834 GMT, while Bouygues jumped 14%. French market leader Orange (ORAN. PA) rose 9% and Iliad 13%.