London - France Telecom may seek to raise e7 billion (R46,8 million) by selling shares in its Orange mobile phone unit, half of what it sought as recently as last month, Michel Bon, the chief executive, said yesterday.
The company reiterated the Orange initial public offering (IPO) would take place at the start of 2001. The company, which has spent more than $50 billion this year on acquisitions and wireless licences, also said Hans Snook would step down as Orange chief executive officer after the share sale and become an adviser to the wireless unit.
Other telecommunications companies, including Deutsche Telekom, have scaled back or postponed mobile unit IPOs in recent months as stocks fell on concerns about rising debt from spending to provide mobile Internet services.
Earlier this month, Telefonica raised about e3,3 billion in an IPO of its cellular unit, about half the amount it predicted six months ago.
"Given the sentiment, I find it astonishing that operators are still coming to the market," said Ben Hauzenberger, who helps manage $500 million in stocks, including France Telecom, for Winterthur Credit Suisse Group in Zurich. "It's a no-win situation: Either they take less money than wished from an equity sale, or they risk getting their debt downgraded."