from Bloomberg (great news for Newbridge):
France Telecom to Acquire All of Global One Venture (full press below).
Finally Global One which awarded NN last fall 500 million US
contract will have only one boss to report and can start to accelerate deployment of NN's backbone.
Now as most of longs remember France Teleom has awarded NN multihundred millon $ contract for its national(separate form G1-international venture) backbone.
Conlusion belongs to investors
Paris, Jan. 26 (Bloomberg) -- France Telecom, Europe's second-
biggest telephone company, said it will acquire all of the Global
One phone venture from partners Sprint Corp. and Deutsche Telekom
AG, for $4.36 billion in cash and debt.
France Telecom will pay Deutsche Telekom $2.76 billion in
cash and repay $189 million in debt for its German partner.
Sprint, which is being acquired by MCI WorldCom Inc., will get
$1.13 billion in cash and debt repayment of $276 million.
The purchase accelerates France Telecom's international
expansion plans, which stalled after it lost a battle last year to
buy No. 3 German wireless carrier E-Plus Mobilfunk GmbH. Global
One, which hasn't made a profit, provides data and telephone
services to large companies with offices worldwide such as Hewlett-
Packard Co. and Coca-Cola Co.
``France Telecom wanted Global One badly enough to pay an
apparent premium to Deutsche Telekom,' said Eric Burkel, an
analyst with Handelsbanken Markets who rates France Telecom shares
a ``buy.' ``This is key to getting France Telecom's international
strategy back on track.'
MCI WorldCom is building its own phone networks in Europe,
causing a conflict for Sprint's Global One partners. France
Telecom and Deutsche Telekom said they would sell their 10 percent
stakes in the Westwood, Kansas-based company after MCI WorldCom
announced the $136.6 billion purchase.
France Telecom shares rose 4.8 euros ($4.81) to 127.9 and
Deutsche Telekom rose 2 euros to 69.40. Sprint shares fell 5/16 to
61 7/16 on the New York Stock Exchange, while Clinton, Mississippi-
based MCI WorldCom dropped 1 1/2 to 41 11/16.
Global One
The four-year-old Global One venture is unprofitable because
of operational and management problems. The partners had expected
it to break even by this year. In August, Deutsche Telekom said
Global One wouldn't meet the target until after 2001.
Global One's partners have mulled changing ownership since
the decade-long alliance between Deutsche Telekom and France
Telecom soured when the German company made an unsuccessful bid
last year for Telecom Italia SpA.
``Global One risks losing customers because of the
uncertainty that has surrounded its future,' said Burkel.
France Telecom said the purchase will strengthen the
company's ability to provide services to these large businesses.
Global One's data network reaches more than 800 cities in 40
countries.
``It also consolidates the two other elements -- becoming a
leading pan-European full-service operator and investing in
emerging markets with high-growth potential,' France Telecom said
in a statement.
France Telecom has struggled to expand elsewhere. It agreed
last month to sell its stakes in Crown Castle U.K. Ltd. and Crown
Castle International Corp. to win U.K antitrust approval for its
investment in NTL Inc., Britain's largest cable-television
company. France Telecom had said that it would invest $5.5 billion
to own as much as a quarter of NTL and to help NTL buy Cable &
Wireless Communications Plc's cable-TV business.
Sprint
Sprint, the No. 3 U.S. long-distance phone company, plans to
sell MCI WorldCom's global services instead of those offered by
Global One.
France Telecom and Deutsche Telekom have agreed to vote their
Sprint stakes in favor of the acquisition by MCI WorldCom. The
companies also will relinquish their seats on Sprint's board.
Sprint and Deutsche Telekom are guaranteed at least two years
of Global One service for their customers who use the network.
Sprint also has to provide service to France Telecom's customers
in the U.S. as part of the agreement. France Telecom plans to seek
alternatives for providing the service in the U.S., a spokesman
said.
Sprint is prohibited from offering services that compete with
Global One to certain customers for one year.
Sprint's share in Global One, which provides international
voice and data services to more than 35,000 business customers,
consisted of a 33 percent stake in Global One's European operation
and half of its operation for the rest of the world.
France Telecom said it will name a new president for Global
One tomorrow. |
