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French Version

Hopefuls line up for third slice of Egyptian mobile market

Eleven consortia of local, regional and international firms have been confirmed by Egypt's National Telecom Regulatory Authority (NTRA) as bidders for the country's third mobile license.

NTRA made the announcement on Thursday, the deadline for the submission of offers. The regulator said it would need six to eight weeks to study the technical capabilities of the companies in question and then whittle them down to a list of qualified bidders.

Official bidding is expected to start in July with a reserve price of $433.8 million.

Egypt's sale of a third mobile license will allow a new entrant into a market dominated by the Egyptian Company for Mobile Services (MobiNil) and Vodafone Egypt. NTRA had extended the deadline for interested parties to submit bids and pay a $4.4 million bond guarantee from April 17 to May 4.

"Bidding for Egypt's third mobile license will start in July. The bidder will be judged on the speed at which they can set up a network," Amr Badawi, senior adviser to the minister of communications and information technology, said in a statement last week.

The number of confirmed license contenders rose to 11 on the day of the deadline as Egypt-based Arab Computer Manufacturing Co., a subsidiary of Mohammad Abdulmohsin Kharafi and Sons Co., on Thursday declared a consortium with Reliance India.

Saudi Telecom (STC) and Telecom Malaysia, in cooperation with the newly formed Egypt-based BICO Telecom, had announced their partnership on on Wednesday.

State-controlled Telecom Egypt (TE), which had hesitated to enter the contest because of divestment issues, made its bid announcement Tuesday, joining forces with Telecom Italia. A TE statement said the parties had agreed that TE would assume a majority stake in the consortium.

Other consortia submitting recent offers include Kuwait's MTC with the Egyptian Financial Group Hermes Holding Co., and a partnership between Russia's AFK Sistema and Egypt's Teletec Communications.

Another confirmed bidder is a consortium of three Egyptian firms and the U.A.E.'s Emirates Telecommunications Corporation (Etisalat). Headed by Egyptian Postal Authority and including National Bank of Egypt (NBE), Commercial International Bank (CIB), and Etisalat as technical operator, this group was described by market watchers as the biggest consortium, technically and financially.

Kuwait's Wataniya Telecom (NMTC) teamed up with Al-Watany Bank of Egypt.

Telenor, Norway's market leader in the field of telecommunications, and Egypt's National Telecommunications Holding Corp. (NTC) also publicized a bid announcement on Tuesday. Telenor and NTC said they would jointly deliver an application to qualify for participation in the auction.

Qatar Telecom announced on April 12 that it had struck a partnership with Egypt's Naeem Holding as bidders for the network license. Qtel will hold a majority stake in this consortium, which includes Singapore Technologies Telemedia as third partner.

Earlier in April, state-owned Banque Misr teamed up with Turkey's Turkcell, accompanied by Saudi Arabia's Amwal Al-Khaleej Commercial Investment Company.

South Africa's MTN Group, also known for its expansionist strategy, formed a consortium with Cairo-based Raya Holding and Golden Pyramids Plaza (GPP, the Saudi owners of the CityStars Mall).

Other names that had been in play as possible bidders, such as Maroc Telecom, Bahrain's Batelco, and Beirut-based Investcom, apparently withdrew from the race.

Among these three, Investcom's situation changed significantly as the operator moved ahead this week in negotiations with MTN Group under which the South African operator would acquire the Middle Eastern firm in a combined cash and shares swap deal.

Arabic-language newspapers around the region dedicated much coverage On Thursday to the issue of Egypt's third mobile license, with many highlighting the chances of contenders from their respective countries.

The NTRA had announced two months ago that the third network could be operative by mid-2007. A frequency will be allocated to the successful bidder from March 2007, after which the winner can start installing the network and testing it.

Cairo,05 09 2006
The Daily Star
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