Algiers to acquire 51% stake in Djezzy?

12 Jan 2012

The Algerian government has set its sights on a 51% in Orascom Telecom Algerie, which operates under the name Djezzy. The cellco – currently 96.81%-owned by Orascom Telecom Holding (OTH), which in turn is 51.7%-owned by Russia’s Vimpelcom – has been the subject of a prolonged ownership dispute since the Algerian government first expressed a desire to nationalise the company in 2010, despite Vimpelcom’s subsequent acquisition of OTH’s assets in early 2011.

Last week Vimpelcom and Algeria’s Ministry of Finance signed a non-binding Memorandum of Understanding (MoU) to explore the sale of a majority stake in Djezzy, but the actual size of the stake remains unclear. However, Zoheir Meziane, an adviser to the Minister of Post, IT and Communications, told Bloomberg: ‘Effectively the decision to buy a 51% stake in Orascom Telecom Algeria has been taken by the government. Neither the price, nor the time to finalise this transaction has been fixed for the moment’. Vimpelcom is believed to be seeking to retain management control over OTA, as well as permission to continue to consolidate the operator under International Financial Reporting Standards (IFRS).

Algeria, Global Telecom Holding (GTH, formerly OTH), Optimum Telecom Algerie (Djezzy), VEON