Telecom Egypt Sees Regulator Decision on Vodafone Stake in 2013

Telecom Egypt (ETEL), the monopoly fixed- line operator, expects the regulator to decide on the fate of its stake in Vodafone Egypt and the resolution of a dispute with two incumbent mobile phone operators next year, paving the way for obtaining Egypt’s fourth mobile license.

“We are waiting for a decision by the regulator on whether we will be forced to divest from Vodafone Egypt or just leave our seats on the board of directors,” Ahmed Labib, Telecom Egypt’s investor relations manager, said by phone. Telecom Egypt holds 45 percent stake in Vodafone Egypt.

Telecom Egypt is also expecting a decision following a September arbitration hearing on a claim involving two incumbent mobile phone operators, Labib said. The company claims that competitor Egyptian Co. for Mobile Services, or Mobinil, paid lower interconnection rates to Vodafone Egypt.

The decisions on its stake and the dispute resolution will “hopefully” be made in 2013, Labib said. The third existing mobile phone operator is the United Arab Emirates’ Etisalat (ETISALAT) Misr. Egypt’s mobile phone operators would also be given fixed- line licenses, which they would operate through Telecom Egypt’s network, Labib said.

The shares fell for the first time in four days, declining 2.1 percent to 14 pounds, at 11:32 a.m. in Cairo. The stock gained as much as 2.2 percent to 14.4 pounds yesterday after the National Telecommunications Regulatory Authority confirmed it would issue the company with a mobile-phone license.

To contact the reporter on this story: Nadine Marroushi in Cairo at nmarroushi@bloomberg.net

To contact the editor responsible for this story: Alaa Shahine at asalha@bloomberg.net

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