Cable & Wireless has announced plans to sell its 20 per cent stake in the French mobile phone operator Bouygues Telecom to Bouygues SA for £700 million.
The transaction will take Bouygues SA's direct holding in Bouygues Telecom to 21 per cent and its indirect holding to just under a third (32.7 per cent).
Bouygues and its partners are considering raising development funds for the mobile business via a stock market flotation next year.
Cable & Wireless has been attempting to off-load its Bouygues Telecom stake for over a year. Prior to reaching agreement with Bouygues SA, it held talks with Telecom Italia and other Boutgues shareholders.
The £700 million sale figure represents a heathly increase on the £456 million Cable & Wireless originally expected to raise.
Commenting on the rise, a spokesman for Cable and Wireless said the earlier lower price had been "in the context of a proposed alliance" with Telecom Italia.
The higher price tag reflects the rising value of mobile communications businesses in the past year, the spokesman said.
Cable & Wireless will make a profit of £525 million on the sale, which is expected to be completed by mid July.
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