France Telecom Bids $116m for IT Services Firm

France Telecom SA has made a 91m-euro ($116m) offer to acquire a majority stake in software services firm Groupe Silicomp, another move that highlights the ambitions of telecoms operators in the IT services sector.

Grenoble-based Silicomp focuses on developing and integrating security and communications systems for companies in the transportation and telecoms sectors. It has more than 1,000 staff and made a net profit of 3.5m euros ($4.5m) on sales that rose 17% to 105m euros ($134m) in full-year 2005, and increased revenue 21% in the first nine months of this year to 88.3m euros ($113m).

Approximately 45% of the company’s shares are floated on the Paris Stock Exchange, with the remaining 55% held by the company’s three top executives, including chairman and CEO Jean-Michel Gliner, who owns a 40% share.

France Telecom is offering 20 euros per share for the stake held by the three managers, which represents a premium of 16% over its opening price on November 7. Shares have since been suspended and France Telecom has a period of 15 days to conduct exclusive talks with the target company.

Silicomp’s shares lost 40% of their value between January and September this year, driven down by a profit warning. Rumors of the France Telecom bid sent shares up around 20% since the beginning of this month to 17.51 euros, giving the company a market capitalization of 78m euros ($100m).