LONDON, MAY 28: France Telecom plans to announce a 50-billion euro ($45.91 billion) cash and stock purchase of British mobile phone company Orange on Tuesday, and to unveil a new European cellphone group dubbed MobilCo.Sources close to the talks told Reuters on Saturday that only a "bit of fiddling" remained before Orange, which is being sold by Vodafone AirTouch Plc as part of its acquisition of Germany's Mannesmann AG, was sold for the second time in seven months. "We're pretty much on track for Tuesday morning," said one source, adding that the French giant would roll Orange into its mobile operations and pay roughly 20 billion euros in cash, 20 billion in stock and take on around 10 billion euros of debt.The deal is expected to leave Vodafone with around 10 per cent of non-voting shares in France Telecom, which has become increasingly keen to clinch Orange since abandoning a costly British auction for new generation mobile licences in April.Orange won a so-called UMTS (Universal Mobile Telecommunications System) licence in Britain, which will allow mobile phones to offer services such as high-speed, always-on Internet, quality video and fax.Hans Snook, the ambitious chief executive of Orange, will take control of the new business, which will include France Telecom's domestic Itineris brand - the French market leader with over 10 million subscribers - and operations in Denmark, Belgium, the Netherlands, Italy, Austria and Switzerland.France Telecom and Orange plan to list the new business within 12 months, the sources said. The sale of Orange - the last, independent, pure-play mobile operator in Europe - had been expected to trigger a bitter auction battle between the likes of France Telecom, Dutch carrier KPN Telecom and MCI WorldCom.But industry sources say the French, the most vocal of Orange's pursuers, were the first to offer enough certainty and financing to win an exclusive negotiating period with Vodafone.The world's biggest mobile phone company has become increasingly eager to cut a prompt deal, as it is facing a bill of around 20 billion pounds ($29.51 billion) in bids for new generation mobile licences across Europe. Sources declined to divulge how long the exclusivity period would last if talks hit a last minute snag. And one cautioned: "Nothing's done until it's done."But if all goes according to plan, Vodafone will bring forward its results, slated for next Tuesday afternoon, to Tuesday morning, and make a joint announcement with the French. Details still to be ironed out include details about how Vodafone might dispose of its France Telecom stake. European regulators also still need to approve the deal.
