MAY 29, 2000

Orange to be squeezed out?

THERE is expected to be an announcement later this week that the giant France Telecom has bought the Orange mobile phone company from current owner Vodafone AirTouch Plc for nearly $45bn. France Telecom is now expected to announce a new PanEuropean mobile phone company called MobilCo which will include the company's domestic brand Itineris and other mobile phone services it owns in a variety of other European countries. A minority shareholding in the new business would then be floated within a year of the sale.

There have been reports that Orange boss Hans Snook - who is very keen on the F1 program - will not stay on with the company unless it is floated and there are suggestions that he is worried about how much control he will have when the new company is established. In all probability, Snook will take up the offer of a new job with Hutchison Whampoa, the company for which he set up Orange.

If the deal goes ahead and France Telecom decides to get rid of the Orange brand there will be no need for the current sponsorship deal with Arrows. Whether the contracts will be discontinued or a new deal with the MobilCo brand will be used remains to be seen.