San Francisco (AFP) - French telecom giant Orange SA is in early talks about buying into Iran's biggest cellular network operator, the Wall Street Journal reported.

Such a deal could make history as the first time a Western firm has acquired a significant holding in a major Iranian company since Tehran agreed to curb its nuclear program last year in exchange for the lifting of international sanctions.

Orange, which is part owned by the French government, is one of several European companies that have explored the potential of getting a stake in Mobile Telecommunication Co. of Iran, or MCI, the Journal said, citing people close to the matter.

Orange would need to coax financing for a deal out of Western Banks likely to be wary of tripping over US sanctions.

The Journal also reported that Orange would have to adroitly handle the fact that MCI's parent company, Telecommunication Co. of Iran, is owned by a group of companies that in some cases lead back to Iran's Revolutionary Guards Corps.

The Corps is a paramilitary force that runs large swaths of the Iranian economy and remains under US sanctions for its alleged involvement in terrorism, an accusation it denies.

"We are conducting feasibility studies to understand and assess what's possible in this complex environment, particularly with regards to certain economic sanctions that apply to Iran," a spokesman for Orange told the Journal.

France, which took a tough stance against Iran's nuclear program, has moved to position French companies to take advantage of January's lifting of Western sanctions, according to the report.

MCI has a market value of more than $4 billion on the Tehran stock exchange.

Orange has yet to make a formal offer for a stake of any size, and the companies were first expected to complete a commercial agreement to build trust between the two sides, according to the Journal.