Zurich -- France Telecom and Danish group TDC said on Wednesday that they had agreed to merge their Swiss subsidiaries, with the French group to pay EUR 1.5 billion (CHF 2.26 million, USD 2.25 billion) for a majority stake in the new entity.

"France Telecom will pay at closing a net amount of EUR 1.5 billion to TDC," the two companies said in a statement.

France Telecom would become a 75 percent shareholder in the combined entity, and TDC would hold the remaining 25 percent.

This values the new entity Orange Suisse, formed from France Telecom's Orange Communications and TDC's Sunrise Communications, at EUR 2.1 billion.

At the end of the first year of the deal, France Telecom will also have the option to buy TDC's shares at a minimum price of EUR 1.2 billion.

AFP / Expatica