France Telecom has made contact with TeliaSonera to study under what conditions it could enter formal negotiations to buy the Nordic operator, a spokesman said Thursday.

 The spokesman was relaying comments made to investors by Chief Financial Officer Gervais Pellissier at a conference in Lisbon.

While France Telecom has made contact, it hasn't raised the question of the price of an offer for TeliaSonera, the company said in a subsequent statement.

No firm offer has been formulated for TeliaSonera beyond the "indicative proposal" announced June 5, the statement said.

France Telecom made an initial $42 billion cash and share offer for TeliaSonera June 5, which the TeliaSonera board immediately rejected.

France Telecom has "very limited" room to increase the cash part of its offer and doesn't want the current situation to continue beyond a "reasonable delay," Pellissier told investors.

Pellissier reiterated that the company won't change the share element of the offer and that it could walk away from the deal, which isn't "indispensable" to the group's strategy.

The initial offer, which France Telecom said was an indicative approach, not a formal bid, was 52% cash and 48% shares.

France Telecom said Monday it may spend longer working to reach a deal to acquire TeliaSonera than the 15 days it originally gave as a timetable.

A spokeswoman for TeliaSonera declined to comment Thursday.

At 1504 GMT, France Telecom shares were down EUR0.12, or 0.7%, to EUR18.02 compared with a 0.1% rise in France's benchmark CAC-40 index. At 1510 GMT TeliaSonera shares were down 3.5%, at SEK54.50, underperforming a broadly lower market.

Source:Dow Jones Newswires