Algeria’s finance minister has chastised Orascom Telecom for its failure to discuss its proposed sale of its local mobile phone subsidiary with Algerian authorities.
In a press conference in Algiers on 25 May, Karim Djoudi, the country’s finance…
Algeria’s finance minister has chastised Orascom Telecom for its failure to discuss its proposed sale of its local mobile phone subsidiary with Algerian authorities.
In a press conference in Algiers on 25 May, Karim Djoudi, the country’s finance minister, said that Orascom had a legal duty to meet senior members of the Algerian state after it attempted to sell the subsidiary to South Africa’s MTN.
Algeria blocked Orascom’s attempt to sell Orascom Telecom Algérie, or Djezzy as it is also known, on the same day that the Egyptian company revealed that it had held talks with MTN.
Under a law introduced last year, the Algerian state has the right of first refusal whenever a foreign investor puts an Algerian asset up for sale.
At the press conference, Djoudi repeated his willingness to use the law to acquire Djezzy.
“We are exercising our pre-emption right 100%,” he said. “This right requires the parent company to clearly demonstrate its willingness to enter into discussions with the Algerian government to sell Orascom Telecom Algérie. There is no demonstration of this willingness.”
On 21 May, bankers said that MTN no longer wanted to raise $5bn of debt from international capital markets, indicating that it has abandoned its attempt to buy all or part of Orascom Telecom.
Djezzy accounted for 49% of Orascom Telecom’s overall Ebitda in the 2009 calendar year.
