The banks leading next month's €12bn ($11.18bn) initial public offering of Orange, the mobile phone operator owned by France Telecom, are preparing to cut the valuation of the company by nearly 15% to ensure the IPO is successful, according to sources close to the deal.

Dresdner Kleinwort Wasserstein, Morgan Stanley and Societe Generale, the three bookrunners at the head of a syndicate of 22 banks on the IPO, are understood to be aiming for a valuation as low as €60bn to €65bn. This is below the average valuation forecasts of €72bn from banks in the syndicate.