The Algerian government may use one of its state-owned enterprises to buy the mobile phone operator Orascom Telecom AlgĂ©rie, which trades as Djezzy, in a move which further endangers South African telco MTN’s efforts to buy a stake in Djezzy’s Egyptian…
The Algerian government may use one of its state-owned enterprises to buy the mobile phone operator Orascom Telecom AlgĂ©rie, which trades as Djezzy, in a move which further endangers South African telco MTN’s efforts to buy a stake in Djezzy’s Egyptian parent company Orascom Telecom.
According to Hamid Bessalah, Algeria’s minister of communications, the Algerian state will exercise its right of first refusal to buy any asset that foreign investors in Algeria put up for sale.
“We will negotiate. The Algerian government is ready to buy any organisation,” said Bessalah in an interview with the Al-Arabiya television station. “But perhaps the purchase could be through another organisation to facilitate the deal.”
Bessalah declined to name which state-owned enterprise might buy Djezzy or how much it would pay for the country’s largest mobile phone operator.
The minister first threw MTN’s bid for a stake in Orascom Telecom into doubt in a statement on state-owned newswire AlgĂ©rie Presse Service on 28 April.
Bessalah said that the Algerian state might withdraw Djezzy’s licence because Orascom had failed to ask the government’s permission before it tried to sell all or part of its Algerian subsidiary to MTN.
EFG-Hermes, an Egyptian investment bank, values Orascom at about US$9bn. Analysts covering the company say that Djezzy is the most attractive asset. In 2009, it generated 49% of the group’s EBITDA.
Naguib Sawiris, executive chairman of Orascom Telecom, has asked Egypt’s foreign minister to arrange a meeting between himself and Ahmed Ouyahia, prime minister of Algeria, to resolve the dispute.
Orascom has yet to say when the meeting will take place.
Djezzy provided 14.6 million out of 30 million active mobile phone subscriptions in Algeria at the end of December last year, but the operator increased its number of subscribers by just 3.6% compared with a 12.6% growth in the number of subscribers in the whole market.
The operator competes with Qtel-owned Nedjma and Mobilis, which is part of state-owned Algérie Telecom.
