France Telecom SA (FTE) said Thursday that the company and private equity firm Mid Europa Partners have completed the sale of Orange Austria GmbH to Hutchison 3G Austria, a unit of Hong Kong-based conglomerate Hutchison Whampoa Ltd. (HUWHF, HUWHY).
In early February 2012, Hutchison 3G Austria said it agreed to buy Orange Austria from France Telecom and Mid Europa Partners for an enterprise value of about 1.3 billion euros, or $1.72 billion.
The deal combines the third and fourth largest players in the Austrian mobile telephony market, and is part of the ongoing consolidation in Europe's telecom market.
Orange Austria is the third-largest mobile business in Austria, with around 20 percent of the market. In 2010, the group recorded revenue of 578 million euros and net loss of 9 million euros.
France Telecom-Orange held a 35 percent stake in Orange Austria, while Mid Europa Partners owned a 65 percent stake. France Telecom said that the sale of its equity stake in Orange Austria provided it with cash proceeds of around 70 million euros.
For France Telecom, the deal is part of its strategy to reduce its footprint in Europe in order to cut down on costs. France Telecom's chief executive officer Stephane Richard has said that he plans to focus on bolstering the company's presence in emerging markets, especially in Africa and the Middle East, and exit slower growing European markets.
France Telecom, in late December 2011, agreed to sell its Swiss mobile subsidiary Orange Communication S.A to private equity group Apax Partners for 1.6 billion euros.
FTE closed Thursday's trading at $11.07, down $0.13 or 1.16 percent on a volume of 807,921 shares.
HUWHY closed Thursday's trading at $21.62, up $0.17 or 0.79 percent on a volume of 51,871 shares.
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