From: TheStandardEurope.com
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Sent: Wednesday, February 07, 2001 10:05 PM
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Subject: INTELLIGENCER EUROPE: Orange cuts share price
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THE INDUSTRY STANDARD EUROPE'S
I N T E L L I G E N C E R E U R O P E
This week in the European Internet economy
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translations by eTranslate
Wednesday 7 February, 2001
TOP STORY:
* Orange cuts share price
WORTH REPEATING:
* Talking the talk, but not walking the walk
BRIEFS:
* News highlights of the week
BY THE NUMBERS:
* Size Matters - Especially By 2005
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TOP STORY
~~~~~~~~~
Orange cuts share price
France Telecom's mobile subsidiary has reduced its offer price by
almost 20 per cent after its flotation plans received a lukewarm
reception
By Kristi Essick
One week before its planned initial public offering, France Telecom's
mobile subsidiary Orange has cut the offer price for its shares by
nearly 20 per cent.
Orange, which first postponed its IPO last autumn, blamed market
conditions for the drop in offer price. The new price will be fixed at
9.50-11 euros, down from the 11.50-13.50 euros first established two
weeks ago.
France Telecom said in a statement this morning: "Because of difficult
market conditions, France Telecom has decided to adjust the offer
price range in order to assure the success of placement of Orange
shares and to encourage the subsequent evolution of the listed
shares."
The company would not comment on whether the decision to drop the
price range was related to low demand on the part of shareholders, but
rumours have been flying that the company has had trouble placing its
shares with institutional investors. France Telecom has tried to
attract retail shareholders with a 50 cent discount on each share
purchased; this offer still stands.
When Orange announced the IPO on 22 January, the initial price range
would have valued the mobile group at between 55.2 billion and 64.8
billion euros. The new price will value the company at between 45.6
billion and 52.8 billion euros. In total, Orange will float 633
million shares, or 13 per cent of its overall capital, though it has
the option to float up to 15 per cent.
Orange plans to use the money from the float to buy back the £11.3
billion (17.7 billion euros) worth of France Telecom shares now owned
by Vodafone Airtouch. It also hopes to make a dent in its 60 million
euros debt.
The slide in value illustrates an overall malaise in the telecom
sector. When France Telecom first said it would float Orange last
spring, the company had hoped for a valuation of between 100 billion
and 150 billion euros. France Telecom acquired Orange from Vodafone
Airtouch last May for £31 billion (49 billion euros), after Vodafone
acquired the company via its buyout of Mannesmann and was forced to
sell it on competition grounds.
In recent months, the severe downturn in telecom stocks and the
massive amount paid by mobile operators for third-generation licences
has caused telecom stocks to fall out of favour.
"Prices are not what they used to be," said France Telecom CEO Michel
Bon at a press conference during the announcement of the IPO last
month. "The telecom bubble has completely deflated."
----------------------------------------------------------------------
WORTH REPEATING
~~~~~~~~~~~~~~~
"There's a difference between speaking at a conference and telling the
truth."
Karl Watkin, CEO of struggling business-to-business site
Just2Clicks.com, admits his optimistic assertion to a London
conference last October that his company was experiencing an
"e-orgasm" was misleading.
----------------------------------------------------------------------
BRIEFS
~~~~~~
ECOUNTRIES RUNS DRY: Ecountries, the business-to-business publishing
and online marketplace, looks set to close down through lack of cash
less than five months after its launch. Staff at its London HQ were
told the news Wednesday. The company's backers are a consortium of
venture capital companies led by Europe's largest - 3i, and includes
Elderstreet. But after funding the venture to the tune of some $10
million (11 million euros), they have declined to pump in more cash,
saying the business is not viable.
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002424
VC MURDERED IN ARGENTINA: A high-ranking investment banker at the
Latin American operation of London-based venture capital firm
Antfactory and his wife were found dead at an exclusive Argentinean
beach resort on Monday, in what appeared to be an execution-style
shooting. Local reports link the deaths to Antfactory and a failure to
pay bribes. The killer or killers apparently left a message on
Losanovsky Perel's laptop computer saying: "I am a gringo who
collaborates with Citibank, dead for not paying Citigroup's bribes."
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002425
BUY BOUGHT: Struggling electronics retailer Buy.com's UK operations
are set to be taken over by UK store chain John Lewis, in another
example of the high street boosting its Web presence on the back of
pure-play Net retailers. Buy.com had announced in the US last week
that it would shut down or sell its operations in the UK, Canada and
Australia after reporting wider-than-expected losses. John Lewis is
expected to continue to develop Buy.com UK while using its technology
and customer-service platform to enhance its own department store's
online offering.
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002426
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002427
DAYS OF TERRA: After months of repeated clashes, Terra Lycos CEO
Robert Davis last week told the board of directors, many of them
native Spanish speakers: "No mas". His resignation, along with that of
CFO Ted Philip last week, has had serious knock-on effects for the
Spanish portal, and preceded the resignation of Ron Sege, president of
US operations, by only a day. Since the news of the leadership
changes, analysts have taken a sour view of the company's prospects in
2001.
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002428
MURDOCH MERGER: Rupert Murdoch's News Corp is close to a deal to merge
its satellite TV assets with the largest US satellite TV provider
DirecTV, creating a $70 billion (75.3 billion euros) global network,
industry sources said on Wednesday. News Corp and US auto company
General Motors, which controls DirecTV, have sketched out the main
points of a deal that would value the GM subsidiary containing DirecTV
at about $45 billion (48.4 billion euros).
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002429
LETSFUNDIT: LetsBuyIt.com, the aggregate buying site that last month
was close to becoming Europe's most expensive dotcom failure, has
secured a rescue package of just over 52 million euros from new and
existing investors. But convicted German hacker Kim Schmitz is not
among the site's rescuers, despite stumping up part of the 4 million
euros demanded by the company's Dutch administrators late last month
to stave off immediate bankruptcy.
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002430
CHIPS AND OIL: US oilfield services and electronics company
Schlumberger is lining up a loan of around $3 billion (3.2 billion
euros) ahead of a possible bid for troubled Anglo-French IT services
firm Sema Group, banking sources said on Monday. The sources told
Reuters that Schlumberger was in talks with around five of its closest
relationship banks to raise cash to table the bid.
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002431
MONEY TALKS: Deutsche Bank's eVentures investment vehicle has stumped
up half the $10 million (10.7 million euros) first-round financing for
ComSense, an Israeli start-up which has developed a credit card
technology which it believes will help reduce fraud on the Internet.
Founded in 1998, it has developed technology that sits on a credit
card and uses an ultrasonic signal to uniquely identify that card.
Unlike smartcards, ComSense cards should work with most PCs and even
mobile phones.
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002432
DAVOS HACK ATTACK: Anti-globalisation computer hackers infiltrated the
computer systems of the World Economic Forum and stole personal
information of the majority of the high-profile participants in the
Forum's recent annual meeting in Davos, Switzerland. A disc said to
include a list of 27,000 names, some with e-mail addresses and phone
numbers, was handed to a Swiss newspaper. Other information on the
disc included of 1,400 credit card numbers and names.
http://tm0.com/sbct.cgi?s=110982215&i=301226&d=1002433
----------------------------------------------------------------------
BY THE NUMBERS
~~~~~~~~~~~~~~
A survey by eTForecasts suggests a billion people across the globe
will be using the Internet by 2005. Over 400 million people were
online during 2000, according the report. The fastest growing regions
of usage are identified as Asia, Latin America and parts of Europe.
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STAFF
~~~~~
Written by James Price. Send news tips and press releases to
[log in to unmask] at The Industry Standard's London bureau.
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