France Telecom floats Yellow Pages for Wanadoo buyback cash

As part of the strategy of financial consolidation undertaken by France Télécom's CEO Thierry Breton, nearly one-third of the capital of its Pages Jaunes (Yellow Pages) business has been floated on the stock market.

Until Thursday, Pages Jaunes was wholly owned subsidiary of Wanadoo. In February, France Télécom debuted its plan to reintegrate ISP Wanadoo back into the firm but to leave Pages Jaunes as a subsidiary. However, Thursday saw part of its capital being opened to the public.

The incumbent has put 88 million shares on the Paris Euronext stock market – that's 32.11 per cent of Pages Jaunes' capital and a figure that's likely to increase. France Télécom predicts, in effect, for it to rise to 36.93 per cent with employee shares.

With the IPO, the French telco is using part of its subsidiary's capital to pay back the cost of reintegrating Wanadoo. "This will bring in €1.3bn in cash for France Télécom, which will pay back in part the cost of… bringing Wanadoo back into the heart of France Télécom," a spokeswoman from financial services company Standard and Poor's said. She said the operation would be a good move for the telco, allowing it to reduce its debts.

Christophe Guillemin writes for ZDNet France