France Telecom set to take over stake in Le Monde

France Telecom set to take over stake in Le Monde

Paris: France Telecom is set to buy a stake in Le Monde, the chief executive said in an interview Sunday, raising the prospect that the state will have indirect ownership in France’s newspaper of record.

France Telecom’s board of directors is scheduled to meet later Sunday to consider the offer to buy a 34% stake owned by the Lagardere group in Le Monde Interactif, the newspaper’s online business, said Stephane Richard.

The offer is part of an overall deal being finalized by France Telecom along with the weekly Nouvel Observateur group and Spain’s Prisa publishers, which own El Pais newspaper, to take a controlling stake in Le Monde.

“We have laid together the groundwork for an accord with Claude Perdriel and Prisa and it will be presented to the board of directors this evening," Richard told Le Journal du Dimanche. Perdriel is president of the Nouvel Observateur group.

France’s flagship daily, Le Monde is being crushed by a mountain of debt and has put out a call to investors capable of injecting between €80 million and €120 million ($100 million to $150 million) to come to its aid.

A second trio of investors has answered the call: Pierre Berge, the ex-partner of the late fashion designer Yves Saint Laurent, Lazard’s top banker Matthieu Pigasse and Internet tycoon Xavier Niel.

Le Monde’s search for a cash infusion however turned political this month when President Nicolas Sarkozy stepped in and met with the publisher of the cash-strapped daily, Eric Fottorino.

The President told Fottorino that he opposed the Berge-Pigasse-Niel bid because of their ties to prominent left-wingers, drawing accusations from the opposition Socialist Party that Sarkozy was threatening press freedom.

Both Niel and Pigasse are known to be close to IMF chief Dominique Strauss-Kahn, who is weighing a possible run for the French presidency in 2012.

France Telecom CEO Richard said he had not been “asked" to step in with a rival offer for Le Monde but rather had been persuaded to make a move after talking to Mexican magnate Carlos Slim, who backs The New York Times and media baron Rupert Murdoch.

France Telecom, which is partly-owned by the French state, is ready to put down between €50 million and €60 million as part of the overall offer to take over Le Monde, said Richard.

Potential investors have until Monday to present their offers and Le Monde’s supervisory board is to meet on 28 June to decide on the bids.

Founded in 1944 at the end of the German occupation of Paris, Le Monde has a circulation of about 290,000.