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News > International
Mannesmann in French talks
January 18, 2000: 3:19 a.m. ET

Besieged German cellular firm in talks with Vivendi in bid to fend off Vodafone
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LONDON (CNNfn) - Germany's Mannesmann confirmed Tuesday that it was in talks with France's Vivendi and other potential partners in a move viewed as a last-ditch attempt to fend off the hostile $144 billion takeover bid from Vodafone AirTouch.
    However, Mannesmann and Vivendi played down reports that the German firm is seeking to buy Vivendi's 44 percent stake in Cégétel, France's second-largest mobile-phone operator.
    A report in the Financial Times said Vivendi, whose interests range from media to environmental services, would take a stake in Mannesmann in return for the Cégétel stake.
    Analysts said such a move could form a white-knight defense for Mannesmann. "It's negative for Vodafone," Juergen Gries, a trader at
    Merck Finck & Co. in Munich, told Reuters. "It means Vodafone would have to dig deeper into its pockets or else take on a company with more debts."
    However, Vivendi said it was not looking to sell its stake in the cellular operator. It owns 9 percent of Cégétel directly and 70 percent of a holding company that controls a half share in Cégétel, with the remaining 30 percent of the holding company owned by SBC Communications (SBC).
    Mannesmann shares fell 1 percent while Vivendi (PEX) stock was little changed and Vodafone (VOD) gained 0.6 percent.
    Mannesmann already owns 15 percent of Cégétel while British Telecommunications (BT-A) has a 26 percent stake.
    The German company said it was in regular talks with Vivendi and other unidentified business partners.
    Weekend press reports had put Vivendi forward as a possible white knight to counter Vodafone's all-stock offer. Mannesmann chief executive Klaus Esser has earlier said he was not seeking a white knight and would base his defense against Vodafone on strategy and price.
    The company has already sold a 10.2 percent stake to Hong Kong-based Hutchison Whampoa in return for the conglomerate's stake in Orange, Britain's third-largest cellular operator. Hutchison has pledged its shares to Mannesmann's defense.
    Mannesmann released its final defense document last Friday, including a commitment to consider selling shares in its Internet businesses.
    Vodafone's all-share offer expires on Feb. 7. Back to top
    -- from staff and wire reports

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