Egypt postpones selling a new stake in Telecom Egypt

The Egyptian government has postponed the sale of a new stake in Telecom Egypt, the country's largest telecom operator, until global markets are stable.

Earlier this month, Egypt commissioned financial and legal advisors to explore selling an additional minority stake in the company already listed on the market, and to test investor appetite. The government owns 80% of the company, and the rest of the shares are traded on the Egyptian Stock Exchange.

4 mobile phone service companies

worked in Egypt for 4 mobile phone service companies, namely “Vodafone Egypt” affiliated to the British “Vodafone” group, “Orange Egypt” affiliated to the French “Orange” group, "Etisalat Misr" affiliated to the Emirati "Etisalat", and "Telecom Egypt", the government, and "Telecom Egypt" owns a 45% stake in "Vodafone Egypt".

"The government did not prefer to make an assessment under the pressure of market conditions, so the delay was to allow more time and stability in the markets."

Stock markets are gripped by a state of anxiety due to the banking sector crisis in the United States and Europe, at a time when US Treasury bond traders are betting on an economic recession, which fuels the losses of stock markets from America to Asia.

The Qatar Investment Authority had been negotiating with the government of Egypt to buy Telecom Egypt's stake in Vodafone Egypt since last September, but no agreement had been reached yet due to the dispute between the two sides over the proposed acquisition percentage.

As the Qatari sovereign fund wants to obtain the entire share of Telecom Egypt in Vodafone Egypt, while the government does not want to give up a share exceeding 25% of the company.

Telecom Egypt

The government's recent endeavor to sell a new stake in Telecom Egypt came in parallel with announcing the company's business results, which witnessed a slowdown in profit growth.

Amid strong pressures from the exacerbation of the cost of financing due to raising interest rates, and from liberalizing the exchange rate of the pound, as the losses of currency differences exceeded 6.2 billion pounds.

The pace of profits of Telecom Egypt, the largest telecom operator in the country, slowed to single digits in 2022, compared to a growth of 73% for the previous year, affected by the liberalization of the exchange rate twice during the year, and raising interest rates by 800 basis points.