* France Telecom names Stephane Richard as deputy CEO
* Head of French business leaves amid suicide controversy
* Not clear if move will quell problem, analysts say
* Share down 0.2 percent at 17.6350 euros
(adds company extending restructuring freeze, union reaction, share price)
By Leila Abboud
PARIS, Oct 5 (Reuters) - France Telecom on Monday appointed a new leader of its French business to calm a political firestorm over a spate of employee suicides and extended its freeze on restructuring until the end of the year.
Stephane Richard, a former top aide of France's economy minister who is being groomed as next chief executive of the former state-owned telecom operator, will take over immediately from Louis-Pierre Wenes.
Wenes, an ex-management consultant, was closely identified with cost cuts and job moves blamed by union leaders for creating a stressful atmosphere at Europe's third biggest telecoms company.
He became a polarising figure after saying in a recent interview the suicides affected only a "a small handful" of employees who could not adapt and that the situation was "not that bad."
There have been 24 suicides at France Telecom since the beginning of 2008 and 13 attempts, according to labour unions, a pro rata rate broadly in line with the population as a whole.
Some unions and left-wing political parties last week urged CEO Didier Lombard to step aside after a worker threw himself from a bridge but the government said Lombard had its full confidence.
Christian Pigeon, a labour union representative, said the management shake-up would not be enough. "We need more concrete measures to improve working conditions for employees," he said.
Unions have demanded an end to all restructuring and movement of employees in France, no more out-sourcing, and reduction of stress by hiring more workers. They've also called for two days of strikes this week to protest working conditions at France Telecom.
Analysts say such policies could dent France Telecom's profitability and hamper its ability to cut costs.
COST CUTS AT RISK
The firm has said its plans to boost competitiveness and efficiency aims to cut costs by 1.7 billion through 2011, with 32 percent of the amount to come from France.
Although France Telecom has expanded internationally with its Orange brand, especially in the U.K., Poland, and Spain, it still earns about half of its revenues and operating profits in its home market.
As part of its response to the suicides, the company set up a telephone help line for employees and appointed a mediator to field complaints on job re-assignments.
The elevation of Richard to deputy CEO could be a sign that the government, which is France Telecom's biggest shareholder with 27 percent of its capital, could take a more active role in the group.
"With the replacement of Wenes by Richard, the state's control of the group with be much tighter than before," said labour union representative Pigeon.
Michael Kovacocy, telecom analyst at Daiwa Securities, said the appointment of Richard, 51, was a "tolerable move to pacify the press, labour and left-leaning political elements" while leaving current CEO in place and "avoiding damaging/destabilising change at France Telecom."
He wrote in a research note: "Hopefully this will draw a line under this issue and allow management to concentrate on its stated cost control objectives," more of which will now have to come from outside of France.
Shares in France Telecom were roughly flat at 0811 GMT, in line with the CAC 40 index.
(Additional reporting by Matthias Blamont and Dominique Vidalon, editing by Marcel Michelson and David Cowell)