FRANCE TELECOM KEEN TO BUY IN NORTH AFRICA BUT FINDS PRICES TOO HIGH

Mergers, Acquisitions and Financial Results

France Télécom says it is looking to acquire telecoms companies in North Africa, but is concerned about the high asking prices, which it says are pricing it out of the market. Speaking to reporters at a press conference in Bonn, Michel Davancens, the company's managing director for global affairs, confirmed that FT was ‘interested in North Africa, but not at any price,’ adding, ‘We looked at Tunisia and it was just too much.’ FT recently lost out to a consortium of Dubai's Tecom Investments and Tecom-DIG, which acquired a 35% stake in Tunisie Telecom for USD2.25 billion. The French company was outbid in the early stages of the contest. Nonetheless, FT sees Africa as a cash generator and is looking to acquire higher-margin companies such as Morocco's former national monopoly, Maroc Telecom, currently majority-owned by Vivendi.

The Arab companies buying into North Africa have deep pockets and take the long view. Therefore in any open bidding process, France Télécom will probably continue to find itself outbid.

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