France Telecom eyes opportunities in Iraq

PARIS, FRANCE: France Telecom said it was looking at investments in Iraq, following reports the operator was in talks to take a minority stake in Korek Telecom.

The Financial Times reported France Telecom was talking to Korek Telecom, Iraq's third-largest mobile phone operator, as part of a strategy to expand in the Middle East.

"Iraq is an area of strategic interest for France Telecom and we are studying opportunites that could exist there," a France Telecom spokesman said, without commenting on Korek.

The newspaper cited people familiar with the situation saying the deal could give Korek an enterprise value of $1.5 billion and France Telecom could eventually acquire a controlling stake in the company.

Korek, based in Iraq's Kurdish-run north, competes with Zain and AsiaCell, which is partly owned by Qatar Telecommunications.

The mobile phone market has boomed since the U.S.-led invasion of 2003 that toppled Saddam Hussein, with the total customer base of the main providers tripling to around 10 million consumers in the past two years.

France Telecom, Europe's third-largest telecoms operator, began looking for emerging-market opportunities as a way to offset sluggish demand and intense competition in Europe.

It plans to double revenue in emerging markets by 2015, largely through acquisitions.

In September it bought a 40 percent stake in Moroccan telecoms company Meditel, putting it in competition with Vivendi, the majority owner of Morocco's former telecoms monopoly, Maroc Telecom.