BT dashes Vivendi ambition to take over telecoms group

BT has put a €4bn (£2.6bn) price tag on its stake in Cegetel, in effect thwarting the ambitions of media group Vivendi Universal to seize control of the French telecoms operator.

This is the latest move in what has become a corporate game of poker between Cegetel's shareholders. As well as BT and Vivendi, they include Vodafone and American telecoms group SBC.

BT has made no secret of its desire to sell its 26 per cent stake, but insiders said it will not be rushed into a sale.

It is understood BT will not accept Vivendi's equity in exchange for its holding. And analysts said Vivendi may struggle to justify a large cash pur- chase to its shareholders given its €16bn debt mountain.

This will frustrate Jean-Marie Messier, Vivendi's chief executive, who is understood to be keen to take control of Cegetel. As part of Vivendi's transformation from a utility into a media group, it is trying to increase its investments in telecoms. It wants to be able to deliver its home-grown content over networks, especially mobile ones. Critically, Cegetel owns 80 per cent of SFR, France's second- largest mobile operator.

Vivendi is also under pressure to raise its stake in the French company because, con- troversially, it treats Cegetel as wholly owned in its accounts.

While Vivendi frets over BT's stake, Vodafone is waiting in the wings. The mobile giant owns 20 per cent of SFR and privately hopes that any changes in Cegetel's ownership may lead to the rest of the business going up for sale.