TeliaSonera rejects France Telecom $41.9 bln worth bid

"The Board of Directors have engaged professional advisors to assist in its review and assessment of TeliaSonera and have unanimously decided not to support the indicative offer as it substantially undervalues the company," TeliaSonera said in a statement.Â

The statement followed France Telecom's announcement that it was planning a cash-and-share bid for the Nordic region's top telecom operator.

"TeliaSonera is a strong business with excellent growth prospects in its own right. The Board and management are focused on developing the company to its full potential," the statement said.

TeliaSonera chairman Tom von Weymarn said in the statement the indicative price of 56.225 Swedish crowns ($9.32) per share "significantly undervalues this potential".

TeliaSonera said it will make no further comment until there are substantial new developments.

France Telecom said it would launch a bid if it reached agreement with TeliaSonera on Thursday.

The combination would become the world's third-largest fixed broadband company and fourth-largest mobile operator, France Telecom had said, with a portfolio well-balanced between developed and emerging markets.

Shareholders would receive three France Telecom shares for each 11 shares in TeliaSonera and would be guaranteed a cash option of 63 crowns per share for the first 500 shares.

TeliaSonera formed in December 2002 with the merger of Sonera Corporation, a Finnish telecommunications provider, and Telia, a telecommunications operator in Sweden, also exists among the Turkcell's, Turkey's leading GSM operator, founding shareholders.

TeliaSonera is waging a legal battle over control of Turkcell, in which it owns 37 percent, with shareholders Cukurova Group and Russia's Alfa Group. TeliaSonera is also in dispute with Alfa over control of Russia's OAO MegaFon.