The Egyptian regulator has finally approved France Telecom’s offer to acquire Orascom’s direct shareholding in ECMS (MobiNil), the country’s largest mobile operator. France Telecom – via a subsidiary, Orange Participations – had had three earlier offers turned down in what has become a long-running – and often bitter – dispute over ownership of the firm. In a statement, France Telecom said it will pay EGP245 (US$44.71) per share for Orascom’s 20 percent direct shareholding, which represents a premium of 18.9 percent compared with the closing share price on 10 December 2009. The French group said that obtaining the regulator’s approval had removed the only major hurdle preventing the execution of an earlier arbitration ruling that paved the way for it to take control of the firm. As a result, France Telecom says it has contacted Orascom Telecom “with a view to definitively resolving the disagreements between the two groups.” However, the news was less well received at Orascom. A spokeswoman told Reuters that Orascom was “astonished by [the regulator’s] decision,” and was consulting its lawyers over its response.

The complicated ownership structure at ECMS is at the centre of the dispute. France Telecom already owned 71.25 percent of the holding company (also known as MobiNil) that controls 51 percent of ECMS, and was ordered by the arbitration court earlier in the year to buy-out Orascom’s 28.75 percent share in the holding company at a set price of EGP273.26 per share. But the dispute centres on what happens to the remaining 49 percent shareholding, which includes the separate 20 percent Orascom holding and a 29 percent free float. France Telecom had argued that its purchase of the minority ECMS shareholders was not covered by the arbitration court ruling. This was disputed by Orascom and – for a long time – by the Egyptian regulator as well. The regulator had rejected three previous offers by France Telecom for Orascom’s direct stake – valued at EGP187, EGP237 and EGP230 per share – before finally accepting the latest offer this week.