Orange has plums squeezed. Market yelps too
And France Telecom had gone to so much trouble
Well, after all the fuss, a huge cut in issue price and more general nonsense, the Orange float has been a flop. It's currently sitting at six per cent below the issue price of 10 euros. At times it was nearly eight per cent below.
Every financial journalist and analyst now suddenly knows that it was going to be a failure all along, because after all people are still worried about the cost of 3G and, er, it's a bad time for mobile companies. The fact is that France Telecom cut such a wedge off its own company's valuation that it comes as a surprise that the float isn't a success. We still reckon France Telecom should have held off, but then it probably needed the £6.5 billion the IPO raised.
Worse than this, Orange's poor performance has dragged down other tech stocks. France Telecom suffered of course - 6.6 per cent down and to a 16-month low. Nokia was down 2.5 per cent, Sonera 3.6 per cent, Vodafone 1.6 per cent, BT 3.7 per cent. Bookham chip-maker was down 10 per cent, Deutsche Telekom down 5.5 per cent, KPN 5.1 per cent, the list goes on and on.
The future may still be bright but the last two days and the next few weeks look dark for Orange. ®