As the markets turn sickly again, it hardly seems the time to talk about flotations. But it is hard to ignore the coming privatisation programme in France.

Electricité de France (EdF) is valued between €50 billion and €80 billion and is still wholly state-owned. Gaz de France and the aircraft engine-maker Snecma, both 100 per cent state-owned, are also in the frame.

The government also owns sizeable stakes in Air France, Renault, France Telecom, Crédit Lyonnais and defence electronics group Thales, among others.

Even allowing for the fact that the French government will want to retain controlling stakes in some of the dozen or so companies, the total value of shares hitting the market could be as much as €70 billion.

The new government, voted in before the summer under President Jacques Chirac, needs the money to stop its budget deficit overshooting euro-zone guidelines.

There is also the matter of heavy pension commitments.

The privatisation programme has already been under way for some years, but May's elections and then the summer lull intervened.

Now the government waits for the tide to turn in the markets.

The first company to come up for sale should be Air France, in which the government has a 54 per cent stake, according to Mr François Lemoine, analyst at BNP Paribas in Paris.

He says the operation is expected at the beginning of autumn or early 2003 at the latest, although it is understandably holding off on naming a date, given the dire state of the markets. So far, all it has done is name bank advisers to help it with the sale - ABN Amro and Rothschild.

The plan is to reduce its stake to somewhere in the low 20s. Unlike some privatisations, selling Air France will require a change in the law, which will slow the process somewhat.

One encouraging sign was the successful sale in March of Autoroutes du Sud, the biggest toll-raising motorway operator in the country.

Its shares are down a bit on their launch price, but not as much as the market as a whole.

The companies available include both "old economy" defensives such as EdF and Gaz de France and new economy - or newish economy - stocks such as Thomson Multimedia and Dassault Systèmes.

Mr Philippe Dischamps, head of French capital markets at JP Morgan, believes there may be some bias towards selling already-listed companies first but "the key is whether the current price is considered a decent price".

A 14 per cent stake in Thomson Multimedia, worth about €1 billion, was sold successfully in February, but this was directly to institutions with no private investor participation.

However, institutions are no more immune to getting burnt than the man in the street. The price then was €30 a share and the shares are now down to €18.

Perhaps the biggest piece of bad publicity the government has to counter is the performance of France Telecom, whose shares are only a third of the value they were when they were floated five years ago.

They launched at around €30, marched all the way up to €200 and more, and now languish at around €10.

The government still owns 55 per cent of France Telecom, but the prospects of it selling any more in the near future look slim.

In addition, there are fears that France Telecom may have to touch its current shareholders with a rights issue to bolster its tottering pile of debt. Just as with Deutsche Telekom in Germany and other phone operators around Europe, France Telecom over-reached itself at the height of the bubble, paying handsomely for 3G licences and stakes in mobile operators such as MobilCom, which have now turned out to be a liability.

Any rights issue at this point is likely to drive France Telecom shares even lower. Shares in Swedish telecoms group Ericsson, for instance, have fallen from Skr30 (€3.26) to Skr6 since it announced a €3 billion rights issue in April.

For those already owning shares in sell-off candidates such as Dassault Systèmes, the prospect of fresh stock on the market will obviously impose a downward pressure on prices.

When a cut in the state's share of Thomson Multimedia was announced in February, the share price fell 9 per cent, as did the shares of STMicroelectronics for the same reason late last year.

But EdF, Europe's biggest and most aggressively expansionist electricity company, is a prospect that deserves consideration by all investors.

There are a number of hurdles, not least the unions, and its hidden exposure to nuclear decommissioning costs, but the arrival of this 800-pound gorilla will be a big event on the market landscape.