|
France Tel offloads Telmex
|
 |
May 26, 2000: 3:06 a.m. ET
$1.9B sale could be prelude to $45B Orange takeover
|
LONDON (CNNfn) - France Telecom appeared to be amassing its financial firepower late Thursday, when it announced plans to offload its 7 percent stake in Mexican telecom operator Telefonos de Mexico.
France Telecom wants to buy U.K. cellular operator Orange from Vodafone AirTouch (VOD), and widespread media reports in the past week have suggested the French firm has arranged a $30 billion credit line with a consortium of banks.
A global offering of the bulk of its Telmex (TMX: Research, Estimates) stake would recoup some $1.9 billion for the Paris-based company - France's largest by market value -- and Telmex is to buy back the rest of the stake itself, for an estimated $700 million. Telmex is in the process of a share buyback program.
France Telecom's June offering will include 40 million Telmex ADSs, each one equivalent to 20 shares of Telmex Series L stock.
In April France Telecom (PFTE) restructured its holding in Telmex "in anticipation of a future possible orderly disposal of the stock".
Reports Friday indicated a bid for Orange could be imminent. Reuters reported bankers were "working through the night" to get a deal off the ground. Orange's value has soared since Mannesmann bought it last year for $36 billion, and could be worth $45 billion now.
Vodafone has to dispose of Orange following its purchase of Orange's parent, Mannesmann of Germany. The European Commission made the disposal of Orange a condition of regulatory approval for the Vodafone-Mannesmann takeover. Vodafone had been considering divesting Orange as an independent company, although France Telecom's haste to snap up Britain's third-largest cellular operator may make such a move unnecessary. 
-- from staff and wire reports
|
|
|
|
|
 |
|
