France Telecom has confirmed it is to buy a 40 percent stake in Meditel, Morocco’s second-largest mobile operator, for EUR640 million. The initial transaction – which is claimed to value the company at EUR2.14 billion – is the first phase of a plan to fully consolidate Meditel into France Telecom’s accounts by 2015.  The acquisition is the first major deal made by new France Telecom CEO Stéphane Richard (pictured), who described it as “the first concrete step in our new policy of expansion outside Europe” and part of the firm’s plan to double revenues in Africa and the Middle-East over the next five years. Meditel has 2G, 3G and fixed licenses in Morocco and recorded revenues of EUR465 million in 2009. The operator is owned by CDG, Morocco’s state investment house, and FinanceCom, a private holding company, and a stock market flotation is planned “in the short to medium term.” The deal is expected to close by year-end.

According to the latest Wireless Intelligence data, Meditel is the second-largest mobile network in Morocco on 10.4 million connections at the end of Q2, giving it a 37 percent market share. In both mobile and fixed-line, Meditel competes with the market-leader (and former state-owned incumbent) Maroc Telecom, which is now controlled by French media conglomerate Vivendi – a fierce rival to France Telecom both home and abroad. Maroc Telecom controls a dominant 57 percent of the country’s mobile market. According to a Financial Times report today, analysts agreed the deal made strategic sense for France Telecom but noted that the price was relatively high. Meditel’s previous co-owners – Portugal Telecom and Telefónica – each sold their 32.2 percent stakes in the operator for a combined US$1.15 billion last year.

France Telecom’s analyst presentation on the Meditel deal can be viewed here. Wireless Intelligence’s recent analysis of the Moroccan mobile market is here.