France Tel keeps eyes on TeliaSonera, no talks yet

By Astrid Wendlandt

PARIS (Reuters) - France Telecom (FTE.PA: Quote, Profile, Research) said on Wednesday it was still interested in Nordic operator TeliaSonera (TLSN.ST: Quote, Profile, Research) as it posted first-quarter profits and sales in line with forecasts, but said there we no current talks over a deal.

"We are interested in TeliaSonera, I am not going to tell you the contrary," France Telecom's Finance Director Gervais Pellissier told journalists on a conference call.

"There are no negotiations with TeliaSonera nor with any other industry player," he said.

But Pellissier kept alive talk of a bid by adding that if deal does come it could arrive quickly.

"The timing of any deal is a question of weeks not of many months," he said.

Shares in France Telecom, Europe's third largest telecoms operator by market value, rose 0.9 percent to 20.52 euros after the comments. The stock fell sharply last month after the company said it was eyeing TeliaSonera, with investors concerned a deal would be risky and destroy value.

Citi said in a note, "We view FT as the European incumbent with the highest mergers and acquisition risk."

TeliaSonera declined to comment.