PARIS/MOGADISHU (Reuters/AFP) - A French intelligence officer held hostage in Somalia since 2009 was killed along with at least one other soldier during a botched rescue attempt by French troops on Friday night, the French Defence Ministry said on Saturday.

But the Harakat Al-Shabaab Al-Mujahideen insurgent group who were holding Denis Allex said in a statement that he was still alive and being held at a location far from the base where French military helicopters attacked overnight.

The al Qaeda-linked insurgents also said they were holding an injured French soldier, while the French confirmed that one soldier was missing.

Both sides described a fierce firefight during the raid on the Horn of Africa country that French said was carried out by the DGSE intelligence agency that Allex worked for.

The French Defence Ministry said 17 Somali fighters were killed in the fighting, which came on the same day France carried out air strikes against al Qaeda-linked rebels in Mali in west Africa.

Defence Minister Jean-Yves Le Drian said at a press conference the two military operations were not connected and sought to downplay concerns that the botched rescue in Somalia would affect the remaining 8 French nationals being held hostage by Islamists in the Sahara region.

"Faced with the intransigence of the terrorists, who refused to negotiate for three and half years and who were holding Denis Allex in inhumane conditions, an operation was planned and carried out," the ministry said in a statement.

Le Drian said at a press conference that Allex was believed to have been killed during the violence after the raid.

"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.

During their attempts to liberate their comrade, one soldier died after being wounded and one soldier went missing."

Allex was one of two French intelligence officers from the DGSE who were kidnapped by al Shabaab in Mogadishu in July 2009 but one, Marc Aubriere, escaped a month later. Allex had been held ever since.

Authorities in Bula Mareer, a town about 120 km south of Mogadishu, said helicopters attacked on early on Saturday.

"Helicopters attacked al Shabaab at 2.00 am 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.

The ministry said on Saturday Allex was kidnapped when he was carrying out an official aid mission with the Somalian government. France has previously said the two men were in the Somali capital to train local forces.

After his abduction 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.

A video of Allex pleading with French President Francois Hollande to negotiate his release and save his life appeared on a website in October used by 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.

Separately, a French pilot was killed during a helicopter raid to prevent militant groups controlling northern Mali from advancing toward the capital, French Defence Minister Jean-Yves Le Drian said Saturday.

"During this intense combat, one of our pilots... was fatally wounded," the minister told reporters. The raid was carried out at around 1500 GMT on Friday and was launched to support Mali ground troops in the battle for the key town of Kona.

Meanwhile, Malian troops were poised Saturday to reclaim a key town from Islamists threatening to advance on the capital after France sent in its air force, opening a dramatic new phase in the months-old conflict. Witnesses and the Malian army said dozens of Islamist fighters were killed in the battle for Konna, one of the worst clashes since the start of the crisis almost a year ago and the most significant setback inflicted on the Islamists.

US officials said Washington might support France's sudden military involvement to help Bamako wrest northern Mali back from Al Qaeda-linked groups, while Nigeria also said it had dispatched personnel on the ground.

Defence Minister Jean-Yves Le Drian said "Operation Serval" had already claimed its first French casualty when a pilot carrying raids to support Malian ground troops fighting for Konna was killed Friday.

A senior Malian officer in the region told AFP that the army was now fully in control of the town, after spending the best part of Saturday flushing out the last pockets of resistance.

"We control the town, all of it," said Lieutenant Ousmane Fane, a member of the Mopti regional command.

"We have claimed dozens of casualties, even around 100 among Islamist ranks in Konna," he said.

Witnesses reached by AFP spoke of dozens of bodies strewn across the area, with one resident counting 46 dead Islamists.