Orange Sa · EURONEXT:ORA
Orange Sa — France Telecom — Merger or Acquisition (January 2005)
29 slides from Orange Sa's merger presentation, Jan 24, 2005
Slide 1: Form 6-K France Telecom
SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 OF THE SECURITIES EXCHANGE ACT OF 1934 January 24, 2005 Commission File No. 1-14712 FRANCE TELECOM (Translation of registrant’s name into English) 6, place d’Alleray, 7
Slide 2: Proposal to acquire full ownership of Equant
Proposal24, January to acquire 2005 full ownership of Equant
Slide 3: Disclaimer
DISCLAIMER management’s Telecom representation anticipated and market on The circumstances This 2 March operating forward-looking presentation regulatory believes 9,in2004 the initiatives, that after expectations forward-looking contains its and factors. anticipated the expectations statements indat
Slide 4: Content
CONTENT Transaction Impact 3 Conclusion for France Timing Terms Rationale Telecom &—Structure — Why Why? Now? - How?
Slide 5: Content: Rationale - Why?
CONTENT Transaction Impact 4 Conclusion for France Timing Terms Rationale Telecom &—Structure — Why Why? Now? - How?
Slide 6: Enterprise: a key building block of France Telecom
Enterprise: IT HOME Our PERSONAL SALES ENTERPRISE Enterprise 5 &Clients NETWORK & SERVICES division A key building leverages also within relies France block FT on of integrated Personal Telecom the integrated and means IT&N, Home operator more Sales&Services products cross model selling, with their
Slide 7: Enterprise: Domestic and International revenues
Enterprise: Domestic France Fixed, €8bn Belgium, Challenger Managed €1.8bn Rest Outsider Presence €1.2bn Leader Enterprise 6 of ofMobile & of in the revenues through UK, data Poland Europe markets revenues business A world strong and Switzerland, (estimated) managed for mobile Internet (estimated) r
Slide 8: Enterprise: Integrated services towards customer intimacy
Enterprise: Integrated From Business VoIP Upstream Provide Consolidation Messaging Customer CRM Security Understand Assess, Manage Leverage 7 /an ToIP design network the IP-VPN Everywhere IP towards Intimacy IP & aservices customer complexity services clear based Hosting of and related data core, st
Slide 9: Enterprise: Business Everywhere and IT services
Enterprise: Mail, In Business For Upstream Consulting, Customer Integrated 8 countries MNC security, Everywhere, towards Intimacy customers IP-based- IP-based-offers aProject where segmented Hosting, network we & management, offers Support are VoIP CRM strategy leaders challengers relateduser IT ser
Slide 10: Equant: A recognized leader in IP-VPN
Equant: An seamless Control Market Dedicated Strong 3700 Worldwide Consistent A 9 recognized unmatched customers, customer leader An ofnetwork teams key award-winning unique attractive leadership in technologies geographical 2/3 references IP-VPN toreach set better ofpositioning ofBusiness in and co
Slide 11: Why a stand alone Equant is challenged
Why A IP pressure network High Transition Equant 10 Changing andsomething end high — stand and not positioning of Specific bandwidth Market being service business alone hascompensated Challenges business to Environment competencies with model change at low a lack model towards cost forby of for Equa
Slide 12: Content: Proposed Terms and Structure
CONTENT Transaction Proposed Impact 11 Conclusion forTerms France Timing Rationale &Telecom Structure —— Why Why?Now? — How?
Slide 13: Why now? Create a stronger Enterprise business
Why Create Leverage Additional IT Integration 12 CAPEX now? a stronger businesses funding creates requirement Enterprise best required through opportunity for IT segment for product &business Network for as portfolio the soon transformation transformation Group ascross possible fertilization Transfo
Slide 14: Content: Proposed Terms and Structure
CONTENT Transaction Proposed Impact 13 Conclusion forTerms France Timing Rationale &Telecom Structure —— Why Why?Now? — How?
Slide 15: Key Proposal Terms
Terms Key Proposal Represents In Premium Share Spot 1-Week 1-Month 3-Month A * 14:fair addition, subject Highlights €3.60 Price proposal of€3.55 to €3.64 €3.70 the toto 16.7% an purchase Premium acceleration Average proposal withholding implied 18.3% 15.4%Share 13.5% allshare the oftaxes Price all a
Slide 16: Proposed Transaction Structure: Summary Description
Proposed 45.8%(1) 54.2%(1) Stage France Free Cash Operating 100% Equant (liquidated (1) 15 Assuming Float distributed 21Telecom Finance NVTransaction Subsidiaries after 282.8m BV distribution) to minority Structure: ordinary shareholders shares Summary and 10.0m Description preference shares outstan
Slide 17: Proposed Acquisition Structure: Key Features and Approval Process
Proposed Acquisition Structure to Approval Process Equant A 16 structure any withholding shareholders Transaction ofand by transaction France process orEGM similar Structure: Telecom designed by of Equant taxes Equant of Key toall Management Delisting ensure Features approving assetsoptimised and an
Slide 18: Why a cash offer?
Why aoffer More Value Scope Faster Speed Cash 17 amount favourable execution cashisproposal? more is consistent process impact efficient on bywith EPS and simplifying France value and FCF enhancing Telecom’s assessment yield than for useand aFrance of stock implementation cashTelecom’s deal policy f
Slide 19: Content: Impact for France Telecom
CONTENT Transaction Proposed Impact 18 Conclusion forTerms France Timing Rationale &Telecom Structure —— Why Why?Now? — How?
Slide 20: What are the benefits of integrating Equant?
What Integrated New Single Upstream A Leverage Broadband CRM Security Hosting Customer Seamless Simplification Accelerate 19combined IP are product based the Equant Sales towards Intimacy IP and portfolio benefits based offers of development reinforce and know processes network Offers & customer inc
Slide 21: Estimated Pro-forma Consolidated Impact
Estimated Pro-forma Consolidated Cash Net Slightly Marginal No 20 impact Debt/ EPSaccretive dilutive impact, EBITDA financial transaction on FCF France TOP Yield Impact Telecom’s impacting objectives on France cash 2005-06 maintained return Telecom potential Groupand of the unchanged proposalfinanci
Slide 22: Expected Timing and Advisors
Expected Jan. Advisors Announcement Legal Fairness TBD Opinion Decision End Availability Mid April Convocation EGM Distribution Beginning 21 24 of May approving and February issued opinion by appointed timetable business ofof Equant’s of of liquidation Equant cash by Equant’s transfer issued indepen
Slide 23: Content: Conclusion
CONTENT Transaction Proposed Impact 22 Conclusion forTerms France Timing Rationale &Telecom Structure —— Why Why?Now? — How?
Slide 24: Conclusion
Conclusion Key Why? Why A An How? France 23reassessment optimized set now? Telecom of assets : Key transaction triggered will and rationale present skills by structure for tochanges astrengthen detailed the transaction and inreview amarket the balanced Group’s offundamentals, itsproposal enterprise
Slide 25: Proposal to acquire full ownership of Equant
Proposal24, January to acquire 2005 full ownership of Equant
Slide 26: Glossary
Glossary Contributive Pro Market Secured services ADSL “ADSL business Network Mobile traffic, bases currently the Internet period. opening Wanadoo 25 United forma (calculated Revenues: activated incoming The ARPU: Share Connect ARPU: revenues and accounts Revenues (1) receive connectivity figures: K
Slide 27: Glossary
Glossary Mobile average Orange Churn, involuntarily churn Customer those treated For channel. SACs and Costs handset 26 Orange administrative connections (SRCs) differs and as the AUPU: World upgrades number Prepaid (2) having disconnections SRCs: measure UK, France, between (excluding are subscribe
Slide 28: Glossary
Glossary REAA: Capex: Opex: Labour Commercial Operating DSO: DPO: Sourcing: FCF Net 27 Debt: (Free Days operating acquisitions Costs: Operating (3) implementation Debt working Cash ofexpenses: net Sales Payables minus Flow): charges of income capital: of Outstanding capitalized cash intangible inclu
Slide 29: Signature
SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. FRANCE TELECOM Date: January 24, 2005 By: / S/ PIERRE HILAIRE Name: Pierre Hilaire Title: Director of Fi
France Telecom — Merger or Acquisition (January 2005) on 6ix