France Telecom announced its intention to acquire all of Equant, pursuing its strategy of integrated approach to the corporate market. The French telecommunications company wants to integrate Equant’s international customer base, as well as its distribution and telecommunications networks, in addition to knowledge in the field of IP network technology.
Currently holding 54.2 percent of Equant, France Telecom is proposing to buy its telecommunications services subsidiary for $ 564 million, equivalent to 4.2 euros per share, or 16.7 percent more on the company’s share price last Friday and 15.4 percent over the stock market value a month ago, specifies the French incumbent.
«Our proposal is an excellent opportunity for Equant shareholders,» says Michel Combes, France Telecom’s chief financial officer, in a press release. The same official assured that the business will give Equant a «solid» financial base and «more important» resources so that it can offer «the most advanced solutions to its customers who expect greater integration».
The acquisition of 45.8 percent of Equant that the French operator did not yet have will be followed by a distribution of the proceeds from the sale to shareholders of the subsidiary, after which Equant will stop listing on the stock exchange.
In a statement, France Telecom also points out that the proposed transaction will have no impact on its dividend distribution policy or change its objective that the ratio between its debt and its EBITDA should be less than two at the end of 2005, according to French accounting standards.
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