Telenor to put the brakes on Vimpelcom/Orascom deal?

14 Oct 2010

Vimpelcom’s USD6.6 billion bid to buy Orascom Telecom from Egyptian telecoms entrepreneur Naguib Sawiris is by no means a done deal, the CEO of Telenor, one of the Russia telecom group’s main shareholders, has told Vedomosti business daily. Chief executive Jon Fredrik Baksaas commented: ‘We are viewing this deal as a sum of various conditions; either it will be approved or it will not. A great deal of questions needs to be resolved before this can be called a done deal’.

As previously reported in CommsUpdate, a key sticking point in the deal is the battle for control of Orascom’s most lucrative asset, Algerian cellco Djezzy. Vimpelcom is keen to retain the unit, but the Algerian government has declared its intention to nationalise the mobile phone operator. Norway-based Telenor, which holds a 36 % voting stake in Vimpelcom, is generally perceived as taking a more cautious approach towards international expansion than its co-shareholder, Alfa Group. Questioned by Vedomosti as to whether Telenor had been less keen on the deal, an evasive Baksaas admitted: ‘You may well turn out to be correct in your assumption. But Telenor and [Alfa’s telecoms arm] Altimo have equal rights – and such issues require a balanced decision’.

Algeria, Norway, Russia, Beeline (Russia), Optimum Telecom Algerie (Djezzy), Telenor Group, VEON