The decision is a blow to France Télécom's hopes of buying its way to the No. 1 spot in Europe's telecom sector but provided a boost to the value of the Paris-based company, which had tumble on fears it would pay too much for the wrong target.
"Following its proposal for a friendly combination with TeliaSonera announced on 5 June, France Télécom has today decided not to submit a firm offer to TeliaSonera's shareholders," France Télécom said.
Shares in France Télécom traded early Monday morning on the Paris exchange at €18.76 (29.10), up €1.20, or almost 7%, on their previous close. Shares in TeliaSonera, which trade on the Stockholm exchange, tumbled to Skr44, down Skr5.8, or 11.6%.
"This is definitely the right decision," said John Davies, a London- based telecoms analyst with Dresdner Kleinwort Ltd. "I could never see the rationale for the deal." -
Paul Whitfield
