The Nordic operator dismissed the offer as “significantly” undervaluing the company, a view shared by the Swedish government, which holds 37.3 percent in TeliaSonera. Analysts said counter offers for TeliaSonera were now possible.

“My preliminary conclusion is that the bid from France Telecom does not correspond to TeliaSonera’s full potential and worth,” Swedish Financial Markets Minister Mats Odell said.

Finland, which holds 13.7 percent of the company, said that while it would review France Telecom’s bid, it expected other offers to be tabled.

“This is typical of a process that is still in its initial phase and we may expect new offers in the future,” Defence Minister Jyri Haekaemies, who is also responsible for Finnish state ownership, said in a statement.

France Telecom said the deal would create a company spanning 30 countries with 237 million clients — 168 million for mobile phones and 69 million for fixed line services.

“The combination between the two groups would create the number four worldwide telecom operator,” a company statement said.

France Telecom chief executive Didier Lombard told a conference call that the company would wait 15 days to see how its “friendly approach” fared before deciding whether or not to make a formal bid.

This would give enough “time to bring views together,” Lomabrd said, adding: “I do not believe that the situation is blocked.”

The France Telecom offer comprises 52 percent cash and 48 percent in shares, with the cash component pitched at 63 kronor ($10.40) per share and the share component at 56.20 kronor per share.

The offer of 62.35 kronor per share is based on an estimated France Telecom share price of €24.25. But calculated on yesterday’s price of €19.23, the bid is only worth 56.22 kronor, only a few kronors over yesterday’s closing price for TeliaSonera of 53.75 kronor.

“The bid is way too low, the combination of cash and stock as too little per share,” TeliaSonera board chairman Tom von Weymarn told the TT news agency.

France Telecom offered three new France Telecom shares for 11 existing TeliaSonera shares, with a cash guarantee option for all shareholders for their first 500 shares tendered.

A spokeswoman for the company told AFP that this valued the whole company at between €32-34 billion.

Analysts said they believed the offer was too low and could be an opening shot in a battle for control of TeliaSonera which may draw in other companies such as Germany’s Deutsche Telecom and Norway’s Telenor.

“The bid only really values TeliaSonera at 56 kronor per share which is too low … I thought that there would be more cash involved,” one Stockholm based analyst said.

“I believe this bid is only an opening negotiating gambit from France Telecom,” he added.

Analysts at the SEB Enskilda brokerage said it believed “a bid would have to be above 60 kronor to be attractive enough for Teliasonera’s shareholders … At this low level we would not rule out other bidders.”

At investment bank JP Morgan, analysts said they believed that France Telecom was able to raise its offer.

“We sensed France Telecom is not ruling out increasing the offer,” they said.

TeliaSonera has a strong presence in the Scandinavian and Baltic regions, as well as Russia, where France Telecom is not well represented.

The group was formed in 2002 by the merger of Sweden’s Telia and Finland’s Sonera. Besides the Swedish government holding of 37.3 percent, Finland controls 13.7 percent.

France Telecom said Thursday the combined company would be a “well-balanced portfolio between developed and emerging markets.”

Chairman of TeliaSonera, Tom von Weymarn, said in a statement that the group was “a strong business with excellent growth prospects in its own right.”

In midday trading, shares in TeliaSonera showed a gain of 7.44 percent at 57.75 kronor and the OMX Stockholm All Share was up 0.3 percent.

Shares in France Telecom fell 4.42 percent to €18.38 in Paris.

In late trading Thursday, TeliaSonera shares were up 7.91 percent at 58 kronor and the OMX Stockholm All Share was down 0.18 percent.

France Telecom was down 5.49 percent to €18.175 in Paris where the overall market was off 0.41 percent.