Equant Signs Definitive Agreement with France Telecom

    Business Editors

    AMSTERDAM, Netherlands--(BUSINESS WIRE)--Feb. 10, 2005--Equant (Euronext Paris: EQU) (NYSE: ENT) today announced that it has signed a definitive agreement (the "Agreement") with France Telecom providing for the purchase by France Telecom, and the sale by Equant, of substantially all of its assets in exchange for the assumption of all of its liabilities (other than certain retained liabilities relating to the Agreement) and a cash payment equal to approximately EUR 1.26 billion.
    Charles Dehelly, President and Chief Executive Officer of Equant, declared: "This transaction demonstrates the confidence France Telecom has in Equant's ability to turn the company around by delivering on its top priorities: stopping the cash drain, growing profitable sales and developing partnerships. This evolution will make it easier to leverage the significant capabilities of France Telecom, in particular in the area of research and development. It will reinforce Equant's leadership and capability to provide multinational companies with the most advanced global telecommunications solutions and help its customers to improve their efficiency."
    As promptly as practicable following the closing of the transactions contemplated by the Agreement, the proceeds of the asset sale will be distributed to Equant's ordinary and preferred shareholders and Equant N.V. will subsequently be liquidated. Equant's shares will then be delisted from Euronext Paris and the New York Stock Exchange. The sale proceeds for Equant assets yield an implicit price per share of Equant ordinary or preferred stocks outstanding equal to EUR 4.30.
    The shareholder distribution will not be subject to any withholding or similar taxes in the Netherlands. The anticipated per share consideration to Equant shareholders represents an increase of EUR 0.10 from France Telecom's original, non-binding offer made on January 22, 2005. The closing of the transaction contemplated by the Agreement is subject to a number of conditions including the receipt of required regulatory approvals, the absence of any governmental order prohibiting or restraining the consummation of the transaction and the approval of the transaction by the holders of a majority of outstanding shares of Equant, including France Telecom. France Telecom has agreed with Equant to vote its shares, representing approximately 54% of Equant's outstanding share capital, in favor of the transaction.
    The transaction was approved by the unanimous vote of the Special Committee of Equant's Independent Directors. The Special Committee received opinions of its financial advisors, Rothschild Inc. and HSBC Bank plc, that the consideration to be received in the transaction is fair, from a financial point of view, to Equant and all of its shareholders (other than France Telecom). Cleary Gottlieb Steen & Hamilton LLP and De Brauw Blackstone Westbroek N.V are advising the Special Committee as to legal matters.
    The Supervisory Board and the Management Board of Equant also approved the transaction. The Management Board received an opinion from its financial advisor, Morgan Stanley & Co. Limited, that the consideration paid to Equant by France Telecom for all or substantially all of Equant's assets is fair to Equant from a financial point of view.

    About Equant

    Equant (Euronext Paris: EQU) (NYSE: ENT) is a recognized industry leader in global communications services for multinational businesses. Equant combines its network expertise with its expanded services capabilities to provide global, integrated and customized communication services to enable its customers' key business processes. Equant serves thousands of the world's top companies, with the industry's most extensive portfolio of communications services and network solutions, including the market-leading IP VPN used by nearly 1,300 global businesses. Equant, a subsidiary of France Telecom, consistently leads industry surveys in corporate user satisfaction.

    This release may contain projections or other forward-looking statements related to Equant that involve risks and uncertainties. Readers are cautioned that these statements are only predictions and may differ materially from actual future results or events. Readers are referred to the documents filed by Equant with the SEC, specifically the most recent filing on SEC Form 20-F, which identifies important risk factors that could cause actual results to differ from those contained in the forward-looking statements, including, among other things, risks relating to our history of operating losses, the unpredictability of growth in our industry, the fact that the interests of France Telecom, our largest shareholder, may differ from the interests of our other shareholders, changing technology, uncertain and changing regulatory restrictions, currency fluctuations, dependence on suppliers, network security issues, intense competition in our industry and volatility of our stock price. All forward-looking statements are based on information available to Equant on the date hereof, and Equant assumes no obligation to update such statements.

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CONTACT: Equant Media Relations Global and Europe Frederic Gielec +33 1 46 46 21 89 frederic.gielec@equant.com or North and Latin America Elizabeth Mayeri +1 212 251 2086 elizabeth.mayeri@equant.com or Equant Investor Relations Ashley Rayfield +44 20 8321 4581 ashley.rayfield@equant.com or Isabelle Guibert +33 1 46 46 99 53 isabelle.guibert@equant.com

KEYWORD: GEORGIA FRANCE NETHERLANDS INTERNATIONAL EUROPE INDUSTRY KEYWORD: TELECOMMUNICATIONS NETWORKING MARKETING AGREEMENTS SOURCE: Equant

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