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December 14, 2009

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Egypt wants telcos to solve ownership row

EGYPT said yesterday it wanted Orascom Telecom and France Telecom to patch up an ownership row over Mobinil but said the French firm had agreed to find a new Egyptian partner if Orascom sold its stake.

Mobinil has been at the center of a long and often acrimonious dispute between its two main shareholders, Orascom and France Telecom, after the case was taken to arbitration and the court said the French company should buy Orascom's stake.

After rejecting three offers from a France Telecom unit to buy other freely traded stock, Egypt's regulator agreed on Thursday to the unit's latest offer of 245 Egyptian pounds (US$44.90) for each outstanding Mobinil share.

Orascom said it opposed the regulator's decision. The Communications Ministry said in a statement it "continues to hope ... that the two parties in the commercial dispute reach a conciliatory solution that allows them to continue in their successful partnership" in Mobinil, Egypt's biggest mobile operator by subscribers.

But the ministry said France Telecom had agreed to find another Egyptian partner or alliance if Orascom sold its stake.

The deal, if implemented, could net Egypt-based Orascom more than US$1.6 billion but would remove it from its home turf.

Al Gomhuria daily reported yesterday that Naguib Sawiris, chairman and CEO of Orascom, had said he would not sell "no matter the pressures or the temptation."

But an Orascom statement later said Sawiris, who has previously pledged not to give up his firm's stake, "denies he had made any statements to any TV channel or newspapers in connection with the sale of OT's stake in Mobinil."



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