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Technology Stocks : Nokia (NOK) -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (18492)	2/25/2002 1:01:36 PM
From: S100	Read Replies (1) \| Respond to of 34857

France Telecom may face peak-rate MobilCom bill By Vincent Collen and Jamal Henni in Paris and FT.com staff Published: February 24 2002 23:23 \| Last Updated: February 25 2002 14:20 France Telecom may have to buy out shares in Mobilcom, the German mobile phone operator, at peak March 2000 prices, according to one of MobilCom's shareholders. In an interview with Les Echos, the French business paper, Guy Wyser-Pratte, who owns a 1.1 per cent stake in MobilCom, said that under German law, France Telecom must pay March 2000 prices if its dispute with the German operator forces it to make a bid for the company. This would mean paying E200 per MobilCom share, compared with the E13.14 level the shares were trading at on Monday. France Telecom owns 28.5 per cent of MobilCom through its Orange subsidiary, but could be forced to buy the stake of Gerhard Schmid, the German group's chief executive, if the two companies fail to agree on a revised business plan for rolling out third generation mobile phone networks. This would automatically trigger a bid for the rest of the company. At the same time, the conflict between the two companies is causing mounting concern among MobilCom's suppliers and bankers. Neither equipment makers Nokia and Ericsson, which have provided MobilCom with credits totalling E1.8bn ($1.58bn), nor the banking consortium that put up a E4.7bn loan, have guarantees from France Telecom, according to the French operator. Neither Nokia nor Ericsson would confirm the size of their exposure to MobilCom. But according to one sector specialist, Nokia agreed last year to provide MobilCom with a supplier credit of E1.1bn against a telecoms equipment order of E750m. Ericsson is believed to have agreed credit of E750m against orders of E500m. MobilCom at the end of September last year said that it had drawn down E1bn of this, and begun the installation of equipment for its new network. Of this, about E800m is believed to have come from Nokia and the E200m balance from Ericsson. The companies on Monday dismissed the threat, with Ericsson calling its exposure "conservative" while Nokia said that its risk from MobilCom was no greater than normal. Members of the banking syndicate that provided a E4.7bn loan, which needs to be rescheduled in July, are also watching closely. The loan was arranged by ABN Amro, Deutsche Bank, Merrill Lynch and Societe Gene rale via a consortium also made up of BNP, Chase, Dresdner, ING, Bank of Tokyo-Mitsubishi, WestLB and Sumitomo Mitsui. "We are a little worried," said one syndicate member. "It is true that the loan is not formally guaranteed by France Telecom, although it is indirectly." news.ft.com Sounds like a good deal on the share price. Also, nice that this is the normal risk for Nokia.