Telecom Egypt gets mobile green light

Telecom Egypt gets mobile green light

04 APR 2014

Telecom Egypt has been given the go-ahead to acquire a unified licence to provide branded mobile services, putting its partnership with Vodafone Egypt into doubt.

The Egyptian government has approved plans devised by the National Telecommunication Regulatory Authority (NTRA) to allow the fixed-line monopoly holder to run mobile services using the infrastructure of operators in the country.

The largely state-owned company will need to shell out EGP2.5 billion ($358 million) for the required licence, which does not include spectrum.

In addition, mobile operators Vodafone, Etisalat and Orange-owned Mobinil will be given the option to pay EGP100 million to make use of Telecom Egypt’s fixed network.

Mohammed Elnawawy, CEO of Telecom Egypt, said the company will “develop the necessary commercial agreements with our business partners and expedite the steps set out by the NTRA”.

Analysts have speculated that the purchase of the unified licence will mean Telecom Egypt could sell its 45 per cent stake in Vodafone Egypt, which was valued at around £1 billion last year.

According to Financial Times, Vodafone has first refusal on the stake but other options could include Telecom Egypt selling to another local partner or to float shares in the stake on the local stock exchange.

Vodafone Group reportedly said at the beginning of March that it would consider international arbitration if Telecom Egypt was awarded the unified licence.

Vodafone argues that access to Telecom Egypt’s aged copper network unfairly gives the fixed-line operator an advantage. The partnership between the two companies also presents a conflict of interest.

According to GSMA Intelligence, Vodafone was the market leader in Egypt at the end of the fourth quarter of 2013, with 41.7 million connections. Mobinil was second with 35.1 million connections and Etisalat third with 23.5 million.


Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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