Shareholders owning 16% of Orascom Telecom Holding’s (OTH) stock, or 33% of the free float, have agreed to tender their shares in response to Altimo’s offer.
This is below the minimum 26.16% required for the buyout. However, the Russian investment…
Shareholders owning 16% of Orascom Telecom Holding’s (OTH) stock, or 33% of the free float, have agreed to tender their shares in response to Altimo’s offer.
This is below the minimum 26.16% required for the buyout. However, the Russian investment company said in a stock exchange notice that it “would like to proceed with the purchase of those shares tendered and has accordingly applied to the Egyptian Financial Services Authority for consent to proceed.”
Russian billionaire Mikhail Fridman’s Altimo, via its Baskindale subsidiary, had launched its US$0.70 per share offer to acquire the Egyptian telco in mid-April.
A few weeks later Orascom’s board recommended that shareholders do not accept the offer, arguing it undervalued the company.
Russian telco VimpelCom, which controls 51.92% of OTH, had previously announced it would not tender its shares. VimpelCom is itself 47.85%-owned by Altimo.
Overall about 835 million shares were tendered at the US$0.70 per share offer price, which equates to US$585m. Provided Altimo gains consent to buy the shares, it will directly and indirectly control about 41% of OTH.
Commenting on today’s results, Evgeny Dumalkin, vice-president of Altimo, said: “This is a good result and we hope to be able to execute the offer at the level of tenders received. This would be a significant minority investment by Altimo – and one of the largest in an Egyptian listed entity in recent years.”
Altimo, which is the telecoms investment arm of Russia’s Alfa Group Consortium, has hired EFG Hermes as M&A adviser on the transaction. Skadden, Arps, Meagher & Flom as well as Zulficar & Partners are acting as legal advisers.
Meanwhile VimpelCom is said to consider delisting Orascom from the Egyptian and London stock exchanges in an attempt to reduce costs and limit regulatory and political uncertainties. But a delisting may now be in doubt after Altimo failed to secure a majority stake in OTH, Reuters reported citing people close to the matter.
Besides Egypt, Orascom operates in Algeria, Burundi, Zimbabwe, the Central African Republic, Canada, Pakistan and Bangladesh.
