The dust has barely had time to settle on France Télécom's IPO of
Orange. And yet it has already earned its place in the history
books as one of the most significant deals of 2001.
It has set a troubling precedent for all those telecom companies
that were desperately hoping to turn to the equity markets to raise
funding and reduce their leverage. As the Orange price fell even
after the lead banks had reduced the indicative offer price,
anxious chief executives at telecom companies were asking their
finance directors to somehow produce a refinancing plan B.
This was a deal that flopped and that hurt. That's evident from
the blatant attempts of those involved to pass the buck in the days
that followed the IPO on February 13. Rather than concentrating on
exactly what went wrong with the deal, most are busy pinning the
blame on each other. Investors are berating the...
