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France Tel 'aggressive'
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February 11, 2000: 9:49 a.m. ET
French operator sets off in pursuit of $30B U.K. cellular firm Orange
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PARIS (CNNfn) - France Telecom will "aggressively" pursue the possibility of a bid for U.K. cellular operator Orange, the company confirmed Friday.
"A purchase of Orange would be perfectly complementary with our investment in NTL (NTLI: Research, Estimates)," France Telecom's chief financial officer, Jean-Louis Vinciguerra, said in a Thursday conference call with analysts, referring to the firm's 25 percent stake in the Nasdaq-listed U.K. cable company.
"We are very aware of current valuations in the mobile-phone sector," he said, adding that the firm would be "aggressive".
A spokeswoman at France Telecom (PFTE) confirmed the thrust of the comments Friday but refused to comment whether the company was setting up loans in preparation for an approach.
Vinciguerra's comments, which appeared in Friday's edition of French financial daily Les Echos, represented the first official confirmation from France Telecom that it is actively considering a bid for Orange (ORA). The U.K. firm is up for grabs as a result of the recent merger between Vodafone AirTouch (VOD) and Mannesmann (FMMW), which bought Orange last year. Vodafone's U.K. operation is Britain's most popular cellular service provider, and regulators will not allow the newly created telecom giant to also control Orange, the U.K.'s No. 3.
Cash-rich France Telecom has the heaviest weighting on France's CAC 40 index, accounting for about 15 percent. Its stock rose 1.7 percent to 169.70 euros Friday, taking the firm's market capitalization to just over 175 billion euros ($172 billion).
"The stock is rising on a combination of things - yesterday's sales figures showed strong Internet and mobile business and people are positive about the Orange news. They think France Telecom has the means to win it," said a trader, who did not wish to be named.
Analysts attributed France Telecom's aggressive stance to its failure hitherto to make acquisitions in key mobile markets.
"France Telecom has to bid for Orange, it has no choice -- it has fallen behind its peers," said an analyst. "It didn't win E-Plus in Germany," the analyst added, referring to the joint deal between Dutch telephone company Royal KPN and U.S.-based BellSouth (BLS: Research, Estimates) to purchase German cellular firm E-Plus, defeating a bid from France Telecom.
Orange, which analysts have valued at over $30 billion, is also expected to attract interest from KPN and perhaps MCI WorldCom (WCOM: Research, Estimates), the number-two U.S. long-distance telecom operator. 
-- from staff and wire reports
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