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France Telecom on Thursday ruled out taking a stake in Telecom Italia but said it might be interested in forming some kind of industrial partnership with its Italian rival.

The former French telecoms monopoly had been approached by Italian banks trying to expand a consortium that would take a controlling stake in Telecom Italia by buying shares in a Pirelli-controlled holding company called Olimpia.

Following the publication of France Telecom’s first quarter sales figures, Gervais Pellissier, its chief financial officer, said: “We are not minded to participate in the restructuring of the [Telecom Italia] capital.”

However, he said that an industrial partnership could be of interest, citing a network-sharing deal it struck with Vodafone in the UK as an example of the type of alliance that could be attractive.

France Telecom shares rose 3 per cent to €21.59 on Thursday morning after it first quarter turnover beat analyst expectations by increasing by 1.8 per cent to €12.84bn. Gross operating profit rose 1.5 per cent to €4.66bn.

The French group also confirmed that Sanjiv Ahuja, the head of its mobile telephone businesses, was stepping down to pursue “new ventures” after overseeing the roll-out of the Orange brand across the group. He has been replaced by Olaf Swantee, currently a senior vice-president at Hewlett-Packard.

Mr Ahuja will remain chairman of an adviser to Didier Lombard, France Telecom chairman and chief executive. The French group said it would also back an unspecified emerging markets venture of Mr Ahuja’s.

Copyright The Financial Times Limited 2017. All rights reserved.
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