France Tel denies DT merger

Michael Carroll | September 07, 2010

telecomseurope.net

Thumbnail:

France Telecom has reassured a leading trade union that it has no plans to merge with rival Deutsche Telekom – a move mooted after Deutsche Bank raised its stake in the French telco.

The operator told representatives of the CFE-CGC/UNSA federation that a merger is not in the cards despite Germany’s national bank increasing its share in the firm to over 5%, stating it only held talks with Deutsche Telekom when required.

Union staff are worried the bank might seek to consolidate its European telecoms operations and sought reassurances from France Telecom about its future, Reuters reported.

Deutsche Bank increased its stake in France Telecom to 5.07% late August, though the move has only just been reported by French financial authorities.

Changes to the rules covering the amount of working capital banks must hold – being discussed in Switzerland this week - have done little to allay the union’s fears of consolidation.

German banks are likely to be hardest hit by the rule changes, which would require them to raise an additional €1 billion, FT.com reports.

Source:

Michael Carroll