France-Telecom Orange and Orascom Telecom have agreed to simplify the convoluted ownership structure behind Egypt-based mobile operator MobiNil.
MobiNil, which is currently owned by FT-O and Orascom in a 71/29 percent split, is in turn owned by the Egyptian Company for Mobile Services.
ECMS is 51 percent owned by MobiNil, while Orascom holds a separate, direct 20 percent stake. The remaining 29 percent is floated on the Egyptian stock exchange.
FT-O has said it will now issue a tender to purchase 100 percent of ECMS via a subsidiary called MT Telecom.
As a result of the proposed sale, MobiNil will no longer hold any shares in ECMS and become a wholly owned subsidiary of FT-O.
MobiNil, which was founded in 1998, has 30 million customers.
In addition, Orascom will reduce its direct stake in ECMS to just five percent but will continue to hold a 29 percent stake in ECMS via MT Telecom.
“We believe this transaction provides a solid basis for our continued partnership with Orascom in ECMS,” said FT-O chairman and CEO Stéphane Richard.
“Furthermore, we believe that our investment demonstrates our continued, strong commitment and belief in ECMS's potential and in the Egyptian economy in general.”