UK cable operator NTL is partnering with Morgan Stanley Dean Witter Private Equity (MSDW) to acquire France Telecom's 49.9% stake in Suez Lyonnaise-controlled French cable operation Noos, for a reported Euros1.35bn.

The deal - which will see NTL and MSDW owning 27% and 22.9% of the cable operator respectively - values Noos, France's largest cable operation with a 22% market share, at Euros2.7bn.

NTL - in which Microsoft and France Telecom own 5% and 18% respectively - operates mainly in the UK, Ireland and Switzerland with a combined 4.5 million cable subscribers. It has also operated a French cable operation with 136,000 subscribers since 1999.

The deal ends France Telecom's involvement in cable TV and also the conflict of interest it faced investing in an operation that Suez wants to upgrade to provide broadband internet and telephony services.

Suez, NTL and MSDW said they intend to invest $693m (FFr5bn) in Noos and expect to bring the cable operator - which is forecast to post a $125m (FFr900m) loss in 2000 - to breakeven in 2004.