France Telecom and Orascom trade blows over MobiNil sale

14 Apr 2009

According to the Financial Times the dispute between France Telecom (FT) and Egypt’s Orascom Telecom regarding the enforced sale of the latter’s stake in Egyptian Company for Mobile Services (MobiNil) has escalated. It is understood that Orascom is claiming that under Egyptian law the French company must also purchase Orascom’s 20% direct stake in the cellco at a price of EGP273.26 (USD49.32) per share. The assertion follows the recent order by the International Court of Arbitration for the sale of Orascom’s 28.75% in holding company MobiNil Communications at that price. FT however has rejected the claims, and argues that the tender for direct shares was not covered by the arbitration ruling, and instead it has offered to buy minority stakes at EGP200 per share. In the wake of the dispute Orascom has proposed an extended deadline of 15 April for the transaction to be completed; the court ruling called for the sale to be finalised by 10 April. FT meanwhile has reiterated its stance that the Egyptian group should face fines of USD50,000 per day for each day the sale remains incomplete.