Vodafone mulling sale of Egyptian subsidiary?

21 May 2010

British mobile group Vodafone is understood to be examining the possibility of selling its controlling stake in its Egyptian subsidiary, the Financial Times reports. According to the broadsheet, citing people familiar with the matter, Vodafone has already started initial negotiations regarding the potential divestment of its 55% holding in Vodafone Egypt, with fixed line incumbent Telecom Egypt (TE) mentioned as the interested party in a deal that could be worth up to GBP3 billion (USD4.3 billion). Despite claims that talks have been ongoing for around a month though, Vodafone declined to comment on the matter, while TE said that it was unaware of any discussions.

The revelation comes after Tarek Tantawy, CEO of TE, which already owns 45% of Vodafone Egypt, said that the fixed line operator was mulling its options for a full entry into the domestic mobile sector; it is believed that if no agreement is reached between Vodafone and TE that the latter may consider trying to secure its own wireless licence, should the government as rumoured offer a fourth mobile concession in the future. Additionally, should a deal be reached it would also underline the willingness of Vodafone Group CEO Vittorio Colao to streamline his company’s portfolio, in line with comments made by the executive earlier this month stating that the group was looking to focus on developing its European units, alongside its interests in sub-Saharan Africa and India.

Egypt, Telecom Egypt, Vodafone Egypt, Vodafone Group