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Algeria Court Fines Orascom Telecom Unit About $1.3 Billion
Orascom Telecom Holding SAE (ORTE), North Africa’s biggest mobile phone company, said an Algerian court fined its unit Djezzy about $1.3 billion for violations of foreign exchange regulations.
Orascom said its unit plans to appeal the ruling, which temporarily would halt implementation of the judgment, according to a statement on the company’s website.
Orascom and Algeria have been locked in an ownership dispute over Djezzy since early 2010. The Algerian government agreed to pay $6.5 billion to buy 51 percent of Djezzy, Reuters reported today. An adviser to the Algerian Finance Minister said he had no information about the deal when contacted by Bloomberg for comment. Orascom Telecom’s press office said it didn’t have any information on the deal. The Egyptian exchange said it was seeking an explanation from Orascom.
“The court ruling is fact and it’s negative for the company while the Algerian government’s offer to buy Djezzy hasn’t yet been confirmed,” Amr El-Alfy, deputy director of research at Cairo-based Commercial International Brokerage Co., said by telephone. “It’s still not clear whether the government’s offer applies to 100 percent or 51 percent of Djezzy shares.”
Shares of Orascom Telecom were unchanged at 4.14 Egyptian pounds at the 2:30 p.m. close in Cairo. They were suspended for most of the trading day pending the release of news. The London- traded shares surged as much as 25 percent before erasing gains and losing 3.9 percent to $3.37 at the close.
Link to Company News: ORTE EY <Equity> CN
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