France Telecom isn’t letting the grass grow under its feet after withdrawing its botched bid for Nordic telco TeliaSonera, letting it be known that it plans—soon—to pursue deals for smaller companies in Ghana, Algeria and Vietnam … and maybe even in Europe. Yawn. Where have we heard that before? It could be a torrid summer for shareholders just breathing a sigh of relief that the Telia deal—which analysts said did little to advance FT’s Africa and Asia ambitions—fell apart. Since abandoning its $40 billion bid for Telia—which would have created the Continent’s largest telecom—FT’s stock has rebounded some 7 percent and Telia’s is down better than 10 percent.
France Telecom’s CFO Gervais Pellissier said the telco won’t be a bystander as consolidation continues in the industry: "We will stay in attentive observation of the situation, and if other opportunities come up, we'll definitely study them." Pellissier in June said even if the Telia deal went sour (prescient or predetermination, hmm), FT expected a “major acquisition” in the next two years.
But an acquisition to suit FT’s taste—and budget—could be hard to find.
"The issue for bigger telecom operators is that all the emerging market targets are trading at nose-bleed valuations," said analyst Mark James at Collins Stewart. "All the future growth is priced in."
For more:
- See the Wall Street Journal story
- and the New York Times story
