France Telecom €1 billion convertible talked at 1.35% to 1.85%, up 32% to 37%

New York, Sept. 1 - France Telecom launched a €1 billion offering of convertible bonds in the Oceanes structure with talk putting the yield at 1.35% to 1.85% and the initial conversion premium at 32% to 37%.

Books were closed on the convertible offering Wednesday evening, and the deal will be priced Thursday.

The bonds are being sold alongside an offering by the French government of 236 million shares in France Telecom, equivalent to a 9.57% stake. The share sale could be increased to 299 million shares or a 12.13% stake if the greenshoe is exercised.

The convertible has a €150 million greenshoe.

BNP Paribas, Goldman Sachs International and Societe Generale are joint bookrunners for the convertible.

In addition to the Regulation S institutional placement, the securities will be offered publicly in France from Sept. 3 to 7.

The convertibles will mature on Jan. 1, 2009. They will be callable from Jan. 1, 2007 at par subject to a 130% hurdle.

Each bond will be convertible into 100 shares. Between 376,000 and 448,000 bonds will be issued.

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