France Telecom shares dip amid plans to sell stake

France Telecom shares fell this week after the French Finance Ministry said it plans to sell a stake in the company worth up to 3.7 billion euros ($5 billion) in order to cut public debt, an Associated Press report said.

The Associated Press report said the French government plans to sell 130 million shares in the country's largest telecom company, but that number could increase to 180 million, or 7% of France Telecom's share capital, depending on the demand.

The shares slipped 2.4% to 20.49 euros ($27.61) in Paris, the report added.

Newly appointed Finance Minister Christine Lagarde said in a statement that the state 'intends to remain a significant shareholder in France Telecom in the medium term.'

After the planned offer, the French government, will still own between 25.5% and 27.4% of Europe's No. 2 telecommunications company, behind Deutsche Telekom, in terms of the number of customers and revenue, the report said.

The Associated Press report also quoted French President Nicolas Sarkozy as saying that he would seek to reduce the country's debt to 60% of gross domestic product, down from more than 65% in 2006, within the next five years.

France Telecom recently sold its Dutch unit for just over 1.3 billion euros ($1.75 billion) to Deutsche Telekom, the report said.