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TELIASONERA

France Telecom eyes TeliaSonera

France Telecom is considering a possible bid for Swedish-Finnish firm TeliaSonera, which would increase its exposure to emerging markets, Finance Director Gervais Pellissier said in a report on Thursday.

Pellisier told the Financial Times that France Telecom was also exploring other options, among them Telenor of Norway, adding that his company saw “no need to hurry.”

“If you ask me whether we are examining a number of companies, including TeliaSonera, I would say yes,” Pellissier said.

“But if you are asking whether this is a full-blown examination, we are not there yet.”

The newspaper said a combined France Telecom and TeliaSonera would be the third largest telecom company in Europe, overtaking Deutsche Telekom, and mark a quickening of the consolidation process underway among European groups.

Following first reports of the deal on Wednesday, France Telecom shares lost six percent while TeliaSonera was up 12 percent, with analysts sceptical about the benefits of such a deal for the French company.

“This is scaring the market a bit … it’s a major move, France Telecom is still in debt and it’s hard to see the strategic benefits of such a move,” said one Paris-based dealer on Wednesday.

TeliaSonera is owned 37.3 percent by the Swedish government and 13.7 percent by the Finnish government whilst the French government holds some 27 percent of France Telecom.

TELIASONERA

‘Rotten’ business claims at Nordic TeliaSonera

Swedish-Finnish telecom operator TeliaSonera has been accused of “rotten” business dealings in Azerbaijan, following a separate bribery scandal in Uzbekistan.

'Rotten’ business claims at Nordic TeliaSonera
A TeliaSonera conference in Stockholm last year. Photo: TT

Folksam, which is one of the largest insurance companies in Sweden, has accused the firm of “systematic cheating”, after it emerged that TeliaSonera’s subsidiary in Azerbaijan had ties with the family of Ilham Aliyev, the Arab nation’s leader.

It has been claimed that the dictator’s daughters were shareholders of TeliaSonera's subsidiary Azertel, via a connected company based in Panama.

“It is distressing that in a large Swedish company…people thought that cheating would pay off in the long run,” Carina Lundberg Markow, one of Folksam’s managers told the TT news agency on Wednesday.

She criticized TeliaSonera for failing to act “in an honest and open way” when entering new markets.

“Instead, they choose to pay for success,” she added.

TeliaSonera is one of the biggest telecom operators in the Nordic and Baltic countries and also operates in several emerging markets in Eurasia including Russia and Turkey, as well as Spain. The Swedish state owns 37.3 percent of the company.

Swedish prosecutor Gunnar Stetler is already investigating claims of unethical business practices in Uzbekistan and told TT he had also been given new information concerning potential bribery in Azerbaijan.

The company has voluntarily cooperated with the investigation, handing over what Stetler describes as “extensive information” about “the terms and conditions in Eurasian countries”.

Stetler said he was unable to discuss how he had responded to the information. But calls are growing for TeliaSonera to release a public report about its business dealings.

“Now it is extremely important to create transparency,” said Lundberg Markow.

“This shows the importance of having a set of values when doing business in complex markets or countries,” she added.

TeliaSonera and Norwegian rival Telenor recently merged their operations in Denmark, while the telecoms giant last year purchased rival Tele2's Norwegian division for 5.1 kronor.