Orange ponders bid for German group

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The Independent Online

The mobile phone operator Orange is considering tabling an all-paper offer of about €1bn (£617m) for MobilCom over the next few weeks in a move that would put an end to the bitter row that erupted over the German telecoms group's future.

The mobile phone operator Orange is considering tabling an all-paper offer of about €1bn (£617m) for MobilCom over the next few weeks in a move that would put an end to the bitter row that erupted over the German telecoms group's future.

Such a move, it is thought, would see Orange and France Telecom share the burden of MobilCom's estimated €6bn of debt between them although France Telecom is expected to get stuck with the lion's share.

While Graham Howe, Orange's deputy chief executive and finance director, would not be drawn on the company's plans for MobilCom, he gave the strongest hint yet that Orange would not be forced to take on too much debt as part of a resolution.

"I think the market, unfortunately, has assumed the worst case scenario [on debt]. It's unlikely that the worst case will manifest itself," he said.

Industry sources said they believed a MobilCom deal would surface over the course of the next six weeks in a move that would see the German group's head, Gerhard Schmid, ousted.

It is understood that a recent proposal, under which investment banks would have bought Mr Schmid's stake and his wife's shares, collapsed after it seemed certain to trigger an offer for the business.

The speculation came as Orange reported a 22 per cent jump in new subscribers to 40.5 million customers in the three months to 31 March.

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