Arab News, Saturday, Sep 12, 2020 | Muharram 24, 1442
Vodafone may reconsider price of Egypt sale to Saudi Telecom
Saudi Arabia: Vodafone may reconsider the planned sale price
of its Egyptian unit to Saudi Telecom Co. (STC) in the light of changing
economic realities, according to sources familiar with the deal.
The move has reportedly come as a result of sustained pressure in the course of
this year on the share price of British-owned Vodafone, which has seen its stock
lose about a quarter of its value year-to-date.
Newspaper Al-Mal quoted sources saying that Vodafone was sticking to the
profitable exit from the Egyptian market scenario, especially as it intended to
make investments in developing 5G technology for communication.
It also reduced the possibility that Telecom Egypt would make a parallel
purchase offer to STC according to the right of pre-emption stipulated in the
clauses of the shareholders’ agreement with Vodafone Global Group, but awaiting
the final value to discuss the sale option.
Bloomberg earlier reported that STC was negotiating with Vodafone International
to reduce the non-binding offer of about $2.4 billion to acquire 55 percent of
Vodafone Egypt.
Investment banks, including Prime and Pharos, expected a decrease in the value
of the planned offer by between 20 percent and 40 percent.
Vodafone signed a memorandum of understanding with STC on Jan. 29 regarding a
possible sale of Vodafone’s 55 percent stake in Vodafone Egypt to STC for $2.4
billion.
Telecom Egypt owns 45 percent of Vodafone Egypt, while Vodafone International
Group owns the remaining 55 percent.