The Scandinavian telecoms company TeliaSonera has found itself in the sights of France Telecom. The French company has offered a cash and share deal worth the equivalent of 30-billion euros in what could turn out to be one of the biggest telecoms mergers in Europe this year.
But ‘could’ is the operative word. Because Telia’s board said the bid is significantly below the group’s real value, and they are not going to back it.
A merger between the two would create the world’s fourth biggest mobile phone operator, with 237-million customers in 30 countries. The French company is specifically eyeing-up Telia’s presence in Turkey and Russia.
The Swedish government is keen to sell its 37.3 per cent stake in Telia, but the Swedish Financial Markets minister echoed the view that the offer was too low. Mats Odell said: “We welcome all partners who are interested in companies where we intend to diminish state-ownership. Of course that is so, but in this specific case I am of the same opinion as the board of TeliaSonera. It’s also my preliminary judgement that this offer from France Telecom doesn’t correspond with the full value and potential of TeliaSonera.”
The Finnish government, which owns 13.7 per cent of Telia, also echoes that view. But the two companies have given themselves a fortnight to think it over. France Telecom’s Chief Executive says if they can’t reach a friendly agreement, they will not be successful.