Vodafone Egypt

History

2022: 5G frequencies sold in Egypt for $1.17 billion

In early February 2022, the Egyptian National Telecommunications Regulatory Authority allocated Orange Egypt and Time Division Duplex frequencies. This decision was a continuation of the tender held by the department to allocate additional frequency bands with a width of 80 MHz in the frequency space of 2.6 thousand. MHz in the TDD system, as a result of which Vodafone Egypt and Telecom Egypt received frequency bands in exchange for $1.17 billion. Both companies signed an additional agreement to license mobile services to allow them to use new frequencies. More details here.

2021

Vodacom Group bought Vodafone Egypt for 2.4 billion euros

In November 2021, the South African telecommunications company Vodacom Group announced the purchase of Vodafone Egypt. Earlier, an agreement was concluded to sell the Egyptian mobile operator to Saudi Saudi Telecom, but this deal eventually fell through.

Under the terms of the agreement, the Vodacom Group for 2.4 billion euros will receive a controlling stake in Vodafone Egypt - 55%. Taking into account the debts of the company being sold, the transaction value is estimated at 2.7 billion euros. The remaining 45% of the shares will remain owned by Telecom Egypt.

Vodacom Group acquired Vodafone Egypt for 2.4 billion euros

Vodacom will pay approximately 80% of the transaction by issuing 242 million new ordinary shares, and the rest will fall on cash. The issuance of new securities will mean that Vodafone's share in Vodacom will increase from 60.5% to 65.1%.

According to Vodacom, Vodafone Egypt is the largest player in the mobile market in Egypt, offering telecommunications services to 43 million consumers and corporate customers, and controlling 43% of the market revenue.

Vodacom Group CEO Shameel Joosub, commenting on the purchase of a majority stake in Vodafone Egypt, said the deal would strengthen Vodacom's position as a leading technology company in Africa, as well as increase network coverage on the continent to more than 500 million people.

The press release also notes that this deal has become strategic, as it will simplify the management of Vodafone and Vodacom holdings in Africa, as well as provide Vodacom with access to another leading business in an attractive market. It is expected that Vodafone Egypt will benefit from closer cooperation with its new parent company, so that the operator can accelerate the growth of the business in the field of financial services and the Internet of Things.^[1]

Saudi Telecom bought 55% of Vodafone Egypt

At the end of September 2021, it became known that Saudi Telecom began searching for a lender who could finance the purchase of Vodafone Egypt.

Earlier, an agreement was concluded to sell 55% of Vodafone Egypt to Saudi Telecom for $2.39 billion. Thus, the value of 100% of the Egyptian business was estimated at $4.35 billion. About 45% of the company is owned by Telecom Egypt.

Saudi Telecom acquired 55% of Vodafone Egypt

Under the terms of the agreement, Vodafone in Egypt will have shared service centers renamed_VOIS (Vodafone Intelligent Solutions). About 7.8 thousand people work in such centers in Cairo, Giza and Alexandria, they provide a wide range of services for Vodafone activities around the world. The success of_VOIS is expected to continue, and Vodafone plans to increase staff by at least one thousand more people in the next 12-18 months, the company said.

To pay for this transaction, Saudi Telecom is looking for the possibility of obtaining a preferential loan of $1.1 billion. According to Total Telecom, the Egyptian regulator asked the Saudi company to buy the entire Vodafone Egypt. According to analysts, the acquisition of 100% will not be a problem for Saudi Telecom, given the large financial capabilities of the operator (nevertheless, Saudi Telecom is looking for a lender). Telecom Egypt, which previously announced its unwillingness to part with its stake in Vodafone Egypt, may become a stumbling block.

At the end of September 2021, Vodafone Egypt announced that over the past three years, the company has invested about $760 million in the development of telecommunications infrastructure in Egypt, and also spent almost $400 million on the purchase of new frequencies.

For Saudi Telecom, the deal with Vodafone Egypt is the first major acquisition outside the Middle East that will provide the company with a serious foundation for expansion in Africa, Total Telecom said in a statement.^[2]

Notes