France Telecom and Orascom on verge of signing final accord

France Telecom and Orascom Telecom may sign the final version of their new shareholder agreement setting out how they will run Mobinil, Egypt’s largest mobile phone operator, by the end of this week.
According to analysts in Cairo, the two telcos are…

France Telecom and Orascom Telecom may sign the final version of their new shareholder agreement setting out how they will run Mobinil, Egypt’s largest mobile phone operator, by the end of this week.

According to analysts in Cairo, the two telcos are only “a couple of days” away from signing the new accord, which is being introduced to end a two-and-a-half-year dispute over the ownership of Mobinil.

The company’s two largest shareholders have taken their squabble to the International Court of Arbitration in Paris, two sets of financial regulators in Cairo, and to an Egyptian court.

The Administrative Court in Cairo effectively brought the dispute to an end when it threw out a France Telecom bid to buy all the equity in Mobinil that it did not already own at £E245 a share.

Under Egyptian law, France Telecom had to wait six months from its rejected bid before making a new offer. Rather than deal with a hostile joint shareholder for the forseeable future, France Telecom opted to seek an agreement with Orascom.

Both companies announced their intention to seek a rapprochement at a Cairo press conference on 14 April.

Once the new shareholder agreement is ready, France Telecom and Orascom will sign the document in the presence of the Egyptian government’s key decision makers: Minister of Telecommunications Tarek Kamel, Minister of Investment Mahmoud Mohieldin, Minister of Commerce Rachid Mohamed Rachid, and Ziad Bahaa el-Din, the chairman of the Egyptian Financial Services Authority.