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Paris (pte022/24.01.2005/11:30) - French telecom giant France Telecom http://www.francetelecom.com has announced that it will buy the remaining 45.8 per cent stake in its business services subsidiary Equant. As the Financial Times http://www.ft.com reports, the company has said it will provide its loss-making subsidiary with a new "financially sound base". Furthermore, it has said it will bail out Equant to the tune of 250 million dollars (191.12 million euros) in a credit facility owing to an "anticipated further deterioration in Equant's results in 2005 and later years."
According to Michel Combes, France Telecom's chief financial officer, the 564 million euros deal to acquire the group, which provides voice and data communication services to multinational companies, was a response to demand by business customers for increased integration. "For France Telecom, integrating Equant's business is consistent with the group's transformation aiming to offer demand-driven, integrated services to its customers in the enterprise, home and personal segments," he said.
France Telecom, Europe's second largest telephone company, said the deal was worth 4.2 euros per Equant share and will provide a "long-term answer to the structural challenges facing Equant on a stand-alone basis." According to the company, the deal would not be concluded until May at the earliest, depending on the agreement of the board and the approval of Equant shareholders.
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