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France Telecom sells Sprint PCS stake

The indebted French carrier pulls in $330 million from selling its 56 million shares of the U.S. cell phone provider.

France Telecom on Friday said it sold its 5.4 percent stake in U.S. cell phone provider Sprint PCS for $330 million.

The French carrier sold the 56 million Sprint PCS shares on the U.S. market through UBS Investment Bank. A UBS representative declined to comment.

The sale of the stake was not entirely unexpected. In 2001, France Telecom, facing $50 billion in debt, began selling off investments it made in other telephone companies. That included its 9 percent stake in long-distance provider Sprint Communications, the owner of Sprint PCS.

"We were waiting for good market conditions" to sell the Sprint PCS shares, a France Telecom representative said. A Sprint PCS representative did not immediately return calls for comment.

Immediately after the sale was announced, shares of Sprint PCS dropped nearly 3 percent to $5.88. France Telecom shares dipped by 25 cents to $22.45.

France Telecom has been among the hardest hit in the telephone industry during the economic slowdown. The company's economic health has worsened because of intense competition that's driven down the price of a telephone call. The French carrier has what is considered to be the largest debt of any company in the world. However, its executives remain upbeat and in May predicted that 2003 revenue will be 3 percent to 5 percent more than 2002.