By John Irish and Abdi Sheikh
France sent commandos into Somalia to rescue a secret agent who had been held by insurgents since 2009, but said on Saturday it believed he had been killed by his captors along with a French soldier during the raid.
The intelligence agency's team flew into southern Somalia by helicopter under the cover of darkness to try to free Denis Allex from the al Qaeda-linked al Shabaab, on the same day France launched air strikes against Islamist militants in Mali.
Defense Minister Jean-Yves Le Drian said the operations were not connected, but France has been concerned that other hostages held in Africa would be at risk if they intervened against the al Qaeda-allied fighters on the other side of the continent.
The Somalia raid, and sending troops to Mali where a pilot was killed in action on Friday, represents President Francois Hollande's biggest foreign policy tests since being elected in May.
France has eight nationals in Islamist hands in the Sahara after a string of kidnappings.
"Commandos broke into where Allex was being detained last night and immediately faced strong resistance," Le Drian told a news conference.
"Intense combat took place, during which - and now I speak with caution - everything leads us to believe that Denis Allex was unfortunately killed by his captors."
Al Shabaab, who had been holding Allex since July 2009, said in a statement he was still alive and being held at a location far from the base where French military helicopters attacked overnight.
"The injured French soldier is now in the custody of the mujahideen and Allex still remains safe and far from the location of the battle," it said.
"Several French soldiers were killed in the battle and many more were injured before they fled from the scene of battle, leaving behind some military paraphernalia and even one of their comrades on the ground."
Le Drian said one French soldier died in the operation and a second was missing.
PLEADING FOR LIFE
The Defense Ministry earlier said 17 Somali fighters were killed in the fighting that had been prompted by "the intransigence of the terrorists, who refused to negotiate for three and half years".
Allex was one of two French intelligence officers from the DGSE intelligence agency who were kidnapped by al Shabaab in Mogadishu in July 2009 but his colleague, Marc Aubriere, escaped a month later.
Allex had been held ever since, in what France called "inhumane conditions".
The ministry said he was kidnapped when he was carrying out an official aid mission with the Somali government. France has previously said the two men were in the Somali capital to train local forces.
A video of Allex pleading with Hollande to negotiate his release and save his life appeared on a website in October used by Islamist militant groups around the world. Reuters could not verify its authenticity.
Hollande said at the time the government was seeking to start talks with any party able to facilitate Allex's release.
After his abduction, al Shabaab issued a series of demands, which included an end to French support for the Somali government and the withdrawal of African Union peacekeepers, whose 17,600-strong troops are helping battle the rebels.
Under pressure from the peacekeeping troops and Somali government forces, al Shabaab has lost many of its major urban strongholds in south-central Somalia since it launched a rebellion against the Western-backed government in 2007.
The rebels, who want to impose their strict interpretation of sharia Islamic law across the Horn of Africa state, withdrew from the capital Mogadishu in August last year and lost their last major bastion of Kismayu six weeks ago.
A Somali government official in Bula Mareer, a town about 120 km (75 miles) south of Mogadishu, said the helicopters attacked overnight.
"Helicopters attacked al Shabaab at 2.00 a.m. this morning. Two civilians died in the crossfire," Ahmed Omar Mohamed, deputy chairman for lower Shabelle region, told Reuters.
An al Shabaab official who asked not to be named said they exchanged fire with French commandos.
"Three helicopters dropped French commandos. We exchanged fire," the official told Reuters.
(Additional reporting by Feisal Omar and Leila Abboud; Editing Alison Williams)