By Joey Gardiner, 18 May 1999 18:10
NEWS France Telecom yesterday announced that it is taking "major arbitration proceedings" against Deutsche Telekom (DT) for a fundamental breach of their partnership agreement following DT's proposed merger with Telecom Italia. In a terse statement, France Telecom confirmed that it further considered its alliance terminated as a result of DT's move. France Telecom is suing for damages running into billions of euros from the International Chamber of Commerce. In December last year France Telecom and DT announced a cross-shareholding scheme in which each company owned 2 per cent of the other. The two companies also have senior members on each other's executive boards and have developed other operational alliances. David Brown, chairman of research group, Schema, said the move was widely expected within the industry as France Telecom has made no secret of its disapproval. "Deutsche Telekom would like to have their cake and eat it" he said, "but France Telecom obviously aren't going to let them get away with it."
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