Orange Egypt agrees to acquire 4G concession for USD484m

14 Oct 2016

Less than a month after turning down the offer of a 4G licence, Orange Egypt is now set to acquire a concession after re-opening negotiations with local authorities. According to Bloomberg, which cites comments made by Orange Egypt CEO Jean Marc Harion at a press conference in Cairo, the cellco will pay USD484 million for 20MHz of LTE-suitable spectrum, along with a further USD11.3 million for a licence allowing it to offer fixed voice connectivity over the network belonging to Telecom Egypt (TE). Orange has, however, postponed a decision on whether to acquire an international gateway licence.

Separately, in a press release Egypt’s Ministry of Communications & Information Technology (MCIT) confirmed that newly-proposed terms for 4G licences had been adopted during a meeting of the National Telecom Regulatory Authority (NTRA) Board held on 12 October. As per these terms, 50% of the 4G licence value must be paid in US dollars, with the remainder paid in local currency, while the same payment method is required for what the regulator referred to as the ‘virtual fixed line phone’ licence. Meanwhile, any company seeking to acquire an ‘international portal’ licence will be required to pay for that entirely in US currency. Notably, the NTRA Board has also said that any operator which opts to pay the full value of a 4G licence in US dollars will take precedence in obtaining any additional frequencies, should these be made available in the future.

This revised licensing framework is now valid until 23 October 2016, at which date the NTRA Board will meet once more to discuss the matter further, including considering offering 4G concessions via an international auction and examining whether additional frequencies can be allocated to TE, which became the first operator to sign for a 4G licence in late-August 2016. As such, Egypt’s two other existing mobile network operators – Vodafone Egypt and Etisalat Misr – have until the aforementioned data to apply for a concession under this latest framework.