France Telecom launched a record €15 billion rescue cash call today to help pay down crushing debts.
The move sent its stock rising on relief that a new management team was taking control of a battered balance sheet.
The well-flagged move is a key part of a strategic overhaul ordered by new chief executive Mr Thierry Breton, hired after France Telecom nearly collapsed under about €70 billion in debt run up in an expansion spree during the late 1990s.
Mr Breton, who joined the state-owned group after his predecessor Mr Michel Bon was ousted last year, has refinanced most of the debt the company owes this year and next and has promised to extract billions of euros of savings from its operations.
The company set the price for the capital increase at €14.50, a 28 per cent discount from Friday's closing price. The equity issue is effectively two-third pre-sold as the French government will subscribe for about €9 billion of the equity issue - equal to its 56-per cent stake in the firm.