Consistently better

25 November 2009 By Una Galani Follow @ugalani

The French operator is bigger in the UK than Deutsche Telekom, but still had to settle for a 5050 joint venture. In Switzerland, it s smaller than Denmark s TDC, but if the regulator approves, FT will get 75 percent. FT gains from TDC s private equity owners desire for an exit.

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France Telecom and Denmark's TDC have agreed to merge their Swiss telecoms operations, Orange Switzerland and Sunrise. Sunrise had 1.8 million mobile subscribers at the end of June 2009 while Orange Switzerland had 1.6 million. The combination would have 38 percent share of the Swiss mobile market, less than market leader Swisscom.

France Telecom will pay E1.5 billion ($2.24 billion) to TDC and will own a 75 percent stake in the combined group.

TDC will have an option to sell its 25 percent stake to third parties after two years and an option after three years to exit through an initial public offering. The transaction is expected to close in May 2010.

TDC is 87.9 percent owned by private equity firms Apax, Blackstone, KKR, Permira and Providence.

France Telecom shares rose 1.7 percent to 17.34 euros in early morning trading on November 25.

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