FT to spend up to USD1.97bn on Mobinil
France Telecom-Orange will spend up to USD1.97 billion to increase its stake in Egyptian Company for Mobile Services (ECMS), which trades as Mobinil, to 95%.
FT currently owns 71.25% of Mobinil shares, while Orascom Telecom Media and Technology Holdings holds the remaining 28.75%.
FT, through its wholly-owned subsidiary, MT Telecom SCRL, will submit an application to the Egyptian Financial Supervisory Authority (“EFSA”) for authorisation to launch an unconditional and irrevocable mandatory public tender offer request to acquire up to 100% of the issued capital of ECMS at a tender offer price per share of EGP 202.5 (the “MTO Price”).
OTMT will reduce its direct shareholding interest in ECMS to 5% of the Company’s capital and voting rights in ECMS by tendering in the MTO a 15% direct stake in ECMS.
MobiNil will tender to the MTO its entire shareholding and the voting rights in ECMS, representing 51.03% of the share capital of ECMS.
OTMT is expected to receive aggregate proceeds of approximately EGP 6 billion for its direct and indirect ECMS stake tendered in the MTO.
After the transactions, MobiNil will no longer hold any shares in ECMS. However, OTMT will remain France Telecom-Orange’s strategic partner in Egypt and will continue to participate in the management of ECMS.
Stéphane Richard, Chairman and CEO of France Telecom-Orange said: “We believe this transaction provides a solid basis for our continued partnership with OTMT in ECMS. Furthermore, we believe that our EUR 1.5 billion investment demonstrates our continued, strong commitment and belief in ECMS's potential and in the Egyptian economy in general.
To further enhance ECMS's integration in the Egyptian economy, France Telecom-Orange intends to ensure that, if the conditions allow it, up to 15% of ECMS’s shares are held by Egyptian shareholders, whether these are private or public companies, or individual shareholders.”
Naguib Sawiris, Executive Chairman of OTMT, remarked “We are pleased to be able to announce the final terms of this transaction to our shareholders. This offer will allow the shareholders of ECMS to crystallize the value created by the company over the years.” He also added: “Alongside France Telecom, our valued partner, we have been a major shareholder in ECMS since its inception, and we look forward to continuing this partnership and to participating in the next chapter of ECMS’ history through our continuing stake and voting rights.”