The Algerian government will reportedly pay US$6.5bn for a majority stake in Russian telco Vimpelcom’s Algerian mobile phone unit, Djezzy, potentially ending a drawn-out ownership dispute.
A Reuters report cited a senior source at Algeria’s…
The Algerian government will reportedly pay US$6.5bn for a majority stake in Russian telco Vimpelcom’s Algerian mobile phone unit, Djezzy, potentially ending a drawn-out ownership dispute.
A Reuters report cited a senior source at Algeria’s finance ministry as saying the deal will see the state acquire a 51% stake in Djezzy.
Vimpelcom acquired a majority stake in Orascom Telecom Holdings (OTH) and subsidiary Djezzy in April 2011 as part if its merger with Wind Telecom.
However, before the takeover was completed, Algeria had announced plans to nationalise Djezzy following a dispute over taxes and fines with OTH.
Vimpelcom’s announcement early this year that it had agreed to sell a majority stake in Djezzy to Algeria, subject to agreement on price, signalled the dispute may finally be drawing a close.
Further affirmation that this may be the case came on 21 March when Algerian finance minister Karim Djoudi was quoted telling reporters in parliament that the government had received a valuation for Djezzy.
The finance ministry was not immediately available for comment.
VimpelCom currently owns a 51.7% stake in OTH, which in turn holds a 96.81% stake in Djezzy.
OTH to appeal Djezzy judgement
Meanwhile, OTH has announced it will appeal the Algerian Court of first instance’s decision to fine subsidiary Orascom Telecom Algeria (OTA or Djezzy) AD99bn (US$1.3bn) and criminally convict a senior member of its executive team.
OTH said in a statement the judgement on the “so-called ‘Bank of Algeria’ case” relates to a claim brought by the Algerian authorities in 2010 concerning alleged breaches of foreign exchange regulations.
Lodgement of the appeal will suspend the judgement, according to the statement.
“OTA maintains that OTA and its senior executive have acted in compliance with the law and OTA is taking the necessary steps to file an appeal,” the statement read.
This statement comes just a few hours after the Egyptian Exchange and the London Stock Exchange announced they have suspended trading in OTH until the company announces a key event.
