France Telecom agrees to Mobinil’s buyout terms (France, Egypt)
Mobile operator France Telecom has finalized the agreement terms to buyout shares in Mobinil, an Egypt based telecom company, from its local partner OTMT.
According to reports, the companies said in a statement that the agreement means France Telecom will now launch a tender offer to acquire 100 percent of Mobinil’s capital at a price of $ 33.5 per share, subject to regulatory approval.
The statement added that OTMT is expected to receive aggregate proceeds of $994 million for its direct and indirect ECMS stake tendered.
As per reports, France Telecom would control a 95 percent stake in Mobinil post this agreement. The move comes as an attempt by France Telecom to enhance its presence in emerging markets.
France Telecom may increase stake in Mobinil (Egypt, Europe)
Telecommunications company France Telecom is reportedly discussing plans to increase its stake in Mobinil, a joint venture between France Telecom and Orascom Telecom Media and Technology by purchasing a part of Naguib Sawiris’s holding.
The increased holding will enable France Telecom to enhance its presence in Egypt as well as counter its declining profit margins in its home market.
According to reports, France Telecom currently owns about 71 per cent of Mobinil Telecom Co., the holding company that controls 51 per cent of Mobinil; while Orascom Telecom Media & Technology controls 29 per cent of the holding company as well as a 20 percent stake in Mobinil.
Egyptian 3G subscribers to grow fivefold by 2012
A new research report has revealed that the Egyptian 3G market is expected to grow five fold by 2012, as compared to 2007.
According to reports, the 3G market, mainly operated by three operators, possesses huge potential for future growth. The 3G penetration level was less than 1 million at the end of 2009 but operators are investing heavily to upgrade existing technology and increase ARPUs.
Operators are trying to convince their customers to move into the new 3G services as a way of freeing up 2G capacity and halting the steady erosion of the ARPUs. Various equipment manufacturers are playing an important role in developing Egypt’s 3G network. Nokia Siemens Networks and Huawei have been developing Mobinil’s 3G networks while Alcatel-Lucent and Motorola are cooperating with Mobinil to establish its 2G network. Furthermore, Cisco Systems and Ericsson have had their part in the development and enhancement of the company’s network infrastructure. Apart from 3G, the report found that Egypt’s mobile market will also grow strongly in the coming years, boosted by an increase in the low-income customer segment, competition between operators and the availability of pre-paid and installment payment options.
Egypt mobile subscriber base reaches 67mn
According to Ministry of Communication and Information Technology, Egyptian mobile subscriber base grew to 66.87 million at the end of November 2010, from 65.5 million a month earlier.
In November 2009, Egypt’s three mobile operators, Etisalat Egypt, Mobinil and Vodafone Egypt, had 53.68 million subscribers.
Egypt’s mobile phone networks restored
Egypt’s mobile phone networks have been able to resume their services after being ordered to shut-down their networks on Friday. Vodafone, France Telecom controlled Mobinil and UAE based Etisalat owned, Etisalat Misr were all ordered to block their networks in selected areas throughout the country.
The move seemed to fail on the government though, as protests had been pre-arranged in anticipation of such action, and the blockage seemed to simply inflame existing anger with the government.
According to Vodafone Egypt, they would like to make it clear that the authorities in Egypt have the technical capability to close their network, and if they had done so it would have taken much longer to restore services to our customers. It has been clear to them that there were no legal or practical options open to Vodafone or any of the mobile operators in Egypt but to comply with the demands of the authorities.
The decision to shut the network had been criticized by international campaigners who called upon the mobile networks to defy the government, despite the technical impossibility of doing so.
There have also been unconfirmed rumors that the mobile networks might be ordered to shut-down again on Monday and that landline networks may also be shut-down. The landline networks have been the main route for internet traffic as users which to dialing international ISPs to bypass the blocked local broadband services.
Egypt’s Telecom Growth May Slow: HC
Cairo-based AlembicHC’s report has revealed that growth in Egypt’s telecommunications industry may be limited next year and beyond as mobile-phone revenue per user and the number of new subscribers decline.
The penetration rate in Egypt is higher than it seems as real penetration is expected to reach 95% by the end of 2010. HC Brokerage, which issued the report, is now known as AlembicHC.
According to AlembicHC, Telecom Egypt, the country’s monopoly fixed-line operator and 45% shareholder of the second-biggest mobile network, Vodafone Egypt, faces better growth prospects because of the diversity of its revenue stream and strong balance sheet. Egyptian Co. for Mobile Services, Egypt’s biggest mobile-network operator also known as Mobinil, will face rising competition and higher costs for upgrading its network.
AlembicHC estimates Mobinil will have a market share of 40.5% at the end of the year, compared with Vodafone Egypt’s 41.1%. According to the report Egypt will have 74.9 million subscribers by year-end.
Mobinil seeking financial support for Network Expansion
If reports are to be believed, Egypt’s Mobinil is seeking to raise US$347 million in debt to fund a network expansion.
According to reports citing the firm’s Chief Executive Officer, Hassan Kabbani, the size of the debt offering depends on market conditions as well as talks with Commercial International Bank (CIB) and the state-owned National Bank of Egypt.
The Central Bank has blocked the mobile network from borrowing additional funds from local banks, as the banks have reached locally imposed limits on how much they can lend to a single customer. When calculating loan limits, the Central Bank Orascom Telecom’s liabilities into consideration because Orascom still owns part of Mobinil.
As per the report, Mobinil had asked for an exception after it had incorporated its financial accounts into those of its other major shareholder, France Telecom.
Mobinil Might sell US$175million bonds to expand funds: CEO
The Egyptian Co. for Mobile Services possibly will issue bonds valued at US$175 million. According to Chief Executive Officer Hassan Kabbani, The Egyptian Co. for Mobile Services may issue bonds valued at US$175 million. The Cairo-based company that operates under the brand Mobinil plans to use the proceeds to fund network expansion. The time frame for the sale is yet to be disclosed.
Mobinil sold 2.32 billion U.S. dollars of bonds this year with the institutional portion having 1.5 times more offers than bonds available, and the sale to individual investors being 11.4 times oversubscribed.
According to Kabbani, the first issue was a huge success, the company got a positive reaction and that’s why the company is thinking of a second issue to fund expansion. Mobinil has a very aggressive expansion plan.The company has difficulties borrowing from banks because the central bank limits how much a local company can rise from lenders and treats, Mobinil as a unit of Orascom Telecom Holding SAE when it should be considered part of France Telecom SA.
Orascom first operation was the Egyptian Company for Mobile Services commonly known as Mobinil. Mobinil is a market leader serving over 24.2 million subscribers representing a market share of 43.6% (as of September 2009). Mobinil is one of Egypt’s five largest companies on Cairo & Alexandria Stock Exchange (CASEâ€) in terms of market capitalization.
Orascom and the Paris-based company in May settled a more than two-year legal dispute over the ownership of Mobinil, keeping the ownership structure unmoved.
