It started back in September when France Telecom held an 87% controlling stake in Orange, with the remaining 13% held by minority shareholders. A decision was made to buy out the minority shareholders, and France Telecom offered 11 of its own shares for 25 Orange shares, and increased its stake in Orange to 98.78%.
However, in November a small number of remaining Orange shareholders, representing just 1.2% of the total stock, decided to reject France Telecom’s all-share offer. France Telecom responded by offering 560m euros ($648.7m) in cash, saying it would pay 9.50 euros ($11.47) for each remaining share.
The shareholder action group, the Association pour la Defense des Actionnaires Minoritaires, considers this price too low and is asking for 9.94 euros ($12.00) per share. The higher price will cost France Telecom an extra 47m euros ($56.7m).
On Tuesday, shares in Orange were suspended in both London and Paris, after the action group used the French courts to block the buy-out of minority shareholders. A Paris appeals court is considering the claim, and it could take up to four months to reach a decision. Until a decision is reached, France Telecom will have to wait to end Orange’s existence as a publicly quoted company.
This article is based on material originally produced by ComputerWire.
