The state-owned Telecom Egypt has reportedly decided to suspend negotiations with foreign companies on setting up of the country’s third mobile phone service, until the move to sell a stake in Telecom Egypt itself is completed. The Egyptian government is apparently still divided over whether to privatize the fixed-line telecom monopoly by selling shares on the stock market or by offering the stake to a strategic investor.
According to a cabinet decision, half of the company’s shares are to be floated on the Cairo bourse while the remaining 10 percent will be offered on world markets, sometime late October. However, the government has repeatedly delayed plans to offer shares in its national telecommunications firm, citing the "unripe" state of global markets.
Local media quoted Telecom Egypt’s chairman as saying that if the stake went to a strategic investor, it would be to help set up the mobile service. He added that Telecom Egypt would keep a controlling stake in its planned mobile arm.
Two private consortia, MobiNil and MisrFone, currently operate Egypt’s GSM 900 cellular phone systems. The Egyptian minister of communication and information technology, Safwat Al-Sharif, consented back in September to award a third operators' license to Telecom Egypt once the government's exclusivity agreements with Egypt's current private GSM license holders expire, end-May 2001 for the first and November 2002 for the second.
The ministry is also discussing granting a fourth mobile service license, which would be publicly offered in an international tender.
The move is expected to generate Egypt between $1.2 and $1.4 billion. The company holds assets worth more than five billion dollars, and is growing at a staggering 20 percent rate annually, according to Egyptian Economy minister, Yussef Boutros-Ghali.
Egypt’s cellular subscriber base was estimated in August 1999 at 550,974, and is expected to reach five million subscribers in ten years time. — (Albawaba—MEBG)
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