France Telecom to receive second round bids for Orange Switzerland (Europe)
France Telecom, a leading telecommunications service provider, is expected to receive the second round bids for its Swiss unit, Orange Switzerland, from five potential buyers. According to reports, some of the shortlisted investors include Providence Equity Partners, Apax Partners and EQT Partners. Sources claim that Naguib Sawiris, founder of Orascom Telecom may also bid for Orange Switzerland along with cable company Liberty Global Inc.
As reported by Wireless Federation earlier, the sale of Orange Switzerland was a strategic decision taken by France Telecom in an attempt to achieve sustained growth in a struggling industry and focus its attention on the emerging markets.As per sources, France Telecom hopes to receive between US$ 1.95 billion and US$ 2.60 from the sale.
The sale being advised by Perella Weinber Partners along with Lazard Ltd. is expected to be finalized in the beginning of 2012, wherein France Telecom will reportedly announce the company chosen to acquire its unit.
Orascom Telecom seeks partners for Orange Switzerland bid (Europe, Egypt)
According to reports, Naguib Sawiris, founder of Orascom Telecom is looking for partners in order to bid for Orange Switzerland valued at around $2.8 billion. Other people who have shown their interest in acquiring the France Telecom SA mobile-phone unit, include Xavier Niel, founder of Iliad, and private equity firms Apax Partners LLP and EQT Partners. As per sources, when questioned about Mobinil, Sawiris said that he has no plans to sell his stake in Mobinil which belongs to Orascom and other shareholders.
As reported by Wireless Federation earlier, France Telecom is hopeful of finalizing a deal for its Switzerland unit by the end of this year and plans to target the emerging markets in the Middle East and Africa. Further, the group may also be looking to sell its units in Austria and Portugal.
Telenor urges VimpelCom shareholders to reject Wind purchase (Norway,Russia)
Telenor ASA has asked VimpelCom Ltd. shareholders to reject VimpelCom’s proposed merger of its telecommunications assets with those of Egyptian billionaire Naguib Sawiris.
According to Telenor, it has suggested VimpelCom to pay an extra dividend of at least $1 a share instead of pursuing the merger with Sawiris’s Wind Telecom.
As per the company, the excessive focus on the Wind Telecom transaction has already harmed the interests of all VimpelCom shareholders, as VimpelCom has fallen from second to third place in the Russian market.
Telenor opposes a plan by mobile-phone operator VimpelCom to issue new stock representing 20% of shares outstanding and 31% of voting rights to investors in Wind Telecom. The Norwegian company argues that most of Wind’s profit comes from Italy, which is a mature market counter to VimpelCom’s strategy of investing in emerging markets.
Telenor shareholders will meet on March 17 to vote on the issue of 630 million shares needed to complete the combination with Wind Telecom in a deal valued at about $6.5 billion. On March 1, a court in London rejected Telenor’s request for an order blocking the meeting.
The Norwegian company holds more than 39% of VimpelCom shares, approximately the same stake as Russia’s Alfa Group, which supports the merger. Alfa Group, which participates in VimpelCom through its telecom subsidiary Altimo, has 44.7% of votes to Telenor’s 36%.
Ottawa to appeal over Globalive court ruling (Canada)
The Canadian government is all set to appeal over a court ruling that had declared that the launch of the Globalive (Wind Mobile) network was illegal.
At the time when Globalive was set up, it had the support from Egypt’s Naguib Sawiris, but Canadian law limits the foreign shareholders to minority interests. Following complaints, the telecoms regulator investigated about the company and found out that while the shareholding was within Canadian limits, the financial and technical backing offered by Sawiris’ Orascom Telecom had pushed its effective interest above the level allowed by the law.
However, the government later overturned that decision and decided to allow the company to launch its services regardless, in a move which was seen as potentially heralding a revamp of the country’s restrictions on foreign investment.
A couple of weeks ago though, a federal court struck down that decision and the company faces a theoretical threat of being shut-down. The Court ruled that the Cabinet order contained two errors and hence that the order should be quashed. This decision does not go into effect for 45 days.
According to Canada’s Industry Minister, Tony Clement, said today that he would like to confirm that the Harper Government will be appealing the Court’s ruling. They believe that their decision was the right one for Canadian consumers and they will vigorously defend it. Globalive is a Canadian company and meets the Canadian ownership and control requirements under the Telecommunications Act. Globalive should, therefore, be able to continue to offer service in the wireless telecommunications market.
According to Anthony Lacavera, Chairman of WIND Mobile, they are pleased that the Government has decided to appeal the Federal Court’s decision. From the beginning, Industry Canada and then Cabinet, maintained, with a full knowledge and understanding of the facts of their structure, that they are fully compliant with the Telecom Act rules, and they are pleased that the Government is vigorously defending its decision.
North Korean Leader meets Orascom Telecom CEO
The CEO of Egypt’s Orascom Telecom has been given a rare honor during his current trip to Pyongyang: an audience with Kim Jong-il and dinner hosted by the reclusive leader for the businessman whose firm owns a majority of North Korea’s only 3G cellular networks.
According to reports, Naguib Sawiris arrived in the North Korean capital on Friday and was received on Sunday by Kim Jong. Kim Jong-il, warmly welcomed his DPRK visit taking place at a time when Orascom?s investment is making successful progress in different fields of the DPRK, including telecommunications.
Orascom holds a 75% stake in Cheo Technology, which operates North Korea’s only 3G cellular network.
The network, the remaining stake in which is held by the government, uses the Koryolink service name. It has seen fast growth in subscribers and currently claims more than 300,000 accounts in just the two years since its launch.
According to company’s previous statement, after starting first in Pyongyang, the network has been expanded to cover provincial capitals and smaller cities and a 3G signal is now within reach of 75% of the population.
Orascom Telecom expects negotiation on Algeria unit (Cairo)
Orascom Telecom’s (OT) Chairman has revealed that the company is seeking international arbitration soon in a dispute with Algeria’s government over the Egyptian company’s unit Djezzy.
A planned $6.6 billion sale of OT assets to Russia’s VimpelCom has been complicated by the argument with Algiers over the future of Djezzy, OT’s biggest revenue generator.
OT reluctantly agreed to talks on the nationalization of Djezzy after Algeria hit the unit with back-taxes, stopping it from moving money abroad and blocking a sale to South Africa’s MTN.
According to Naguib Sawiris, they will resort to international arbitration to resolve the problem of the Djezzy unit and will start the procedures soon.
Algeria’s government has stated that it will pay a market price for Djezzy but has not exactly revealed when an offer would be made.
VimpelCom shareholder, Telenor not supporting Weather deal (Russia, Norway)
VimpelCom’s Norwegian shareholder Telenor would not support the Russian mobile phone group’s $6.6 billion bid for Weather Investments citing available information and recent developments.
According to the company, they don’t believe this transaction makes strategic or financial sense for VimpelCom’s shareholders.
Telenor holds a 36% voting right in VimpelCom. VimpelCom’s board is due to discuss the transaction at a board meeting on Tuesday.
According to VimpelCom earlier reports, it wanted to buy Weather, which includes control of Egypt’s Orascom Telecom and Italy’s Wind from Egyptian tycoon Naguib Sawiris.
VimpelCom face problems with Sawiris deal (UAE)
Russia’s second-largest mobile phone operator, VimpelCom plans to combine with the telecoms assets of Naguib Sawiris, the Egyptian entrepreneur, are in doubt.
VimpelCom’s board is due to meet in Amsterdam on Tuesday to approve the deal, but the mobile operator’s shareholders are privately warning that an agreement may not be reached.
According to sources, the Russian operator could be overpaying for the assets of Weather Investments, Mr Sawiris’ private investment vehicle. He accused Telenor of objecting to proposals for a new shareholder agreement that would accompany the Weather deal.
According to Mr Sawiris, the company has shown extreme courage and extreme flexibility with this transaction. They do not think they gave anybody any reason not to go through with it.
In October, VimpelCom outlined plans to merge with Weather, which owns Wind, Italy’s third-largest mobile operator, and has a controlling stake in Orascom Telecom, the Cairo-listed telecoms company with assets in Africa, the Middle East and Asia.
VimpelCom agreed to pay $1.8 billion in cash to Weather, which would also get a stake worth $4.8 billion in the Russian mobile operator. Weather would hold 19% of the voting shares in the enlarged VimpelCom group.
VimpelCom also agreed to assume about $15 billion of debt held by Wind and Orascom under the transaction.
But the Weather transaction has been dogged by uncertainty partly because it will be the first big test of a 2009 peace deal between Alfa and Telenor following a bitter dispute over Ukrainian telecoms assets.
The uncertainty has also focused on Djezzy, Algeria’s leading mobile operator and Orascom’s most valuable asset. Djezzy is supposed to form part of the VimpelCom deal, but Algeria wants to nationalize it.
Vimpelcom focuses on $4 billion bridge to bond for M&A deal (Russia)
If sources are to be believed, Russia’s VimpelCom Ltd.’s is homing in on a $4 billion bridge loan to be refinanced in the bond market to back the telecommunications company’s $6.5 billion stock-and-cash acquisition of the bulk of Naguib Sawiris’s telecom assets.
According to sources, several banks are in the process of getting internal credit approval to provide the financing.
As per the sources, they are getting guidance from the company on what they are looking for now.
As per the previous reports, VimpelCom is likely to find favor among bond investors as the frenzied search for yield continues. The higher yields offered in emerging markets have always been there, but the recent rush of money has been exacerbated by the lack of issuance in developed markets.
The sources claimed that Vimpelcom has considered the options open to them and are homing in on a $4 billion loan to be taken out in the bond market.
Among the assets that VimpelCom is acquiring are Italian mobile group Wind Telecomunicazioni and a 52% stake in Cairo-listed Orascom Telecom Holdings.
According to the analyst, Orascom alone has $4.2 billion of net bank debt. Wind has net debt of $11.2 billion–mainly in bonds, and mostly with a change-of-control clause that is likely to be triggered by the takeover.
Citigroup, Deutsche Bank and UBS have acted as financial advisers to Vimpelcom on the deal.
Wind Hellas protects debt revamp
Wind Hellas is set to be taken over by its bondholders in its second debt restructuring in a year, in a deal that will wipe out the interests of its shareholders which also include Egyptian entrepreneur Naguib Sawiris.
The company, Greece’s third-largest mobile company, has chosen an offer from a group of its senior secured bondholders which include a unit of Providence Equity, Eton Park and Taconic Capital and distressed debt funds Mount Kellet Capital, Angelo Gordon and Anchorage Advisors that involves taking 100% of the company’s shares in exchange for agreeing to finish US$1.70 billion of debt.
In addition, the funds have agreed to put forward US$333.81 million of fresh funds to infuse liquidity and repay debt, which will in part repay more senior ranking creditors, such as holders of a revolving credit facility.
The deal will leave the company debt-free and has the support of 77% of senior secured bondholders. A second class of US$493.76 million of senior bonds, which are not secured, will be wiped out.
According to the board of Weather Finance III, a holding company for Hellas, it had received evidence that about 77% of holders of senior secured bonds had executed binding agreements to support the offer.
According to the company’s statement, the board of directors was to be strengthened by the appointment of senior international telecommunications executives.
