As expected, Mobilcom AG's supervisory board on Friday agreed that Gerhard Schmid should leave the position of chief executive, to be replaced by the company's chief financial officer, Thorsten Grenz, but there's still a question-mark over the future of the German telecoms company.

A spokesman for major shareholder France Télécom SA announced that it was highly satisfied that Schmid, who founded Mobilcom, would be leaving the company. And the French company said it would put further capital at Mobilcom's disposal in order to secure its survival. "While it's possible for Mobilcom to find a way out, we won't block it," said the spokesman.

But the France Télécom spokesman denied that his company had any intention of reviving its cooperation framework agreement with Mobilcom, which it terminated at the start of June. "This opportunity has definitely been exhausted for us," said the spokesman. A Mobilcom spokesman had earlier told British journalists that the framework agreement was back in force.

Now, at France Télécom's Paris headquarters, it's widely expected that the next few days will bring the signing of an agreement on the refinancing of Mobilcom's 4.7 billion euro in debt, which it incurred in buying a license to operate third-generation mobile services in Germany.

The French ex-monopolist is to guarantee Mobilcom's banking debts via a bond issue, which will pay 8% annual interest. The bond will be of unlimited duration, and it will be convertible into shares in France Télécom or Orange, its mobile subsidiary, once these have reached a target price, more than three times their current level.

Since Thursday evening, France Télécom has been in talks with Ericsson AB and Nokia OY, the suppliers Mobilcom has contracted for its 3G network build-in, in an effort to reach a similar agreement on the financing of its debts with these companies.

France Télécom still has to reach an agreement with Schmid over his 50% stake in the company. If his interests aren't secured, he will be able to torpedo any attempts to salvage Mobilcom.

Over the weekend, Schmid was still saying that he would only be prepared to sell his shares at a unit price of 22 euro. The highly geared France Télécom has described this as too much. Talks are still being held on France Télécom's offer for Schmid's shares, and also, industry experts believe, on the terms of a public offer for outstanding Mobilcom shares.

One problem for France Télécom is the decline in its own share price. Only last week, it fell by 20% in value to close the week at 12.41 euro. It lost 14% on Thursday alone, and market insiders put this down to maneuvering by British and American hedge funds. In March 2000, when the French company bought into Mobilcom (it now holds 28.5%), its share price stood at a lifetime high of 219 euro.

Analysts were at the weekend wondering aloud whether France Télécom wasn't taking on too much with Mobilcom. They were also voicing doubts on the French company's chances of carrying through the disposal plan with which it aims to dismantle its debt burden.