Egypt’s Financial Authority calls for more details on Orascom/FT agreement on MobiNil ownership dispute
Egyptian telecoms group Orascom Telecom has been given a week in which to provide further details to the Egyptian Financial Supervisory Authority (EFSA) of the recently announced deal with France Telecom (FT) related to the ownership dispute of mobile operator Egpyptian Company for Mobile Services (MobiNil). According to Reuters, the EFSA has called on Orascom to clarify how it calculated the USD300 million settlement fee that FT will pay to Orascom as part of the agreement, while it is also seeking further information about the put option price that formed part of the deal. Further, the financial watchdog has asked for more details on how the management structure of MobiNil will be affected by the accord between Orascom and FT, alongside requesting clarification of how earnings will be accounted. The EFSA has not specified what action it may take should it not receive the information it has requested, although it is understood that it will not appeal a court decision made last month that upheld an appeal by Orascom which blocked a proposed buyout of MobiNil by FT; FT had offered EGP245 (USD44.4) per share for the stake it did not hold in the mobile operator, an offer which the EFSA had accepted in January 2010.
As previously reported by CommsUpdate, last month it was revealed that the long-running battle for control of MobiNil had all but been resolved, with the French giant and Egyptian group reaching a tentative agreement, under the terms of which MobiNil’s current corporate structure will remain unchanged, as will existing voting rights in the cellco. In addition, the proposals will also see the integration of local internet service provider LINKdotNET Egypt, at present a wholly-owned Orascom subsidiary, into MobiNil, while FT also reportedly agreed to change its accounting methods to fully consolidate MobiNil.