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Last Updated: Wednesday, 27 July 2005, 08:27 GMT 09:27 UK
France Telecom buys Spain's Amena
France Telecom shop
France Telecom already owns the Orange mobile phone network
France Telecom has announced it is to buy Spanish mobile operator Amena, signalling what could be a new wave of consolidation within the industry.

France's state-owned telecoms giant will pay 6.4bn euros (4.4bn; $7.7bn) for 80% of Amena, which is owned by Spanish fixed-line operator Auna.

France Telecom said the deal with Amena would boost cash flow within a year because of increased efficiencies.

On Monday, Irish operator Eircom bought mobile firm Meteor for 420m euros.

Mobile advantage

France Telecom said its acquisition of Amena would give it assets worth 8.9bn euros, including 1.7bn euros of tax advantages.

The deal is France Telecom's biggest takeover of a foreign operator in more than four years.

The company already owns the Orange mobile phone network, which it bought in 2000 following UK-based Vodafone's takeover of Germany's Mannesmann.

Mobile phone businesses are attractive to telecoms companies such as France Telecom because mobile use is growing faster than traditional fixed-line services.

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