SABIC chief highlights supply headwinds

SABIC chief highlights supply headwinds
SABIC chief highlights supply headwinds

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Jeddah - Yasmine El Tohamy - CAIRO: Vodafone Group has struck a preliminary deal to sell its 55 percent stake in its Egyptian unit to Saudi Arabia’s largest telecoms operator STC for $2.4 billion, the companies said on Wednesday.

It values Vodafone Egypt at around $4.4 billion and the pair agreed to a long-term partnership agreement, which includes use of the Vodafone brand, preferential roaming arrangements, and giving access to Vodafone’s central procurement function.

Selling the stake is in line with Vodafone’s efforts to streamline its global operations in order to focus more on Europe and sub-Saharan Africa, Vodafone CEO Nick Read said.

Vodafone Egypt CEO Alexander Froman added that the company planned to hire more than 1, 000 employees and that the executive structure of the outfit would not be changed. He added that negotiations could take up to two months and that the deal required the approval of various parties. 

Vodafone has 7,800 employees in Cairo and Alexandria. 

Egypt’s Minister of Telecommunication and Information Technology Amr Talaat said that the proposed deal underscored the attractiveness of the telecommunications industry in the country.

FASTFACT

STC, also known as Saudi Telecom, is majority owned by Saudi Arabia’s state fund the Public Investment Fund (PIF).

“This is why a giant telecom company the size of STC invests in this sector,” Talaat said. 

He added that the ministry as well as the National Authority for Telecommunication Regulation would maintain the quality of service offered to the Egyptian public.

“The potential takeover of a successful company like Vodafone goes in line with the company’s strategy to grow regionally,” STC CEO Nasser Al-Nasser said. “We underline our persistence to be pioneers in the telecommunications field not only in Saudi Arabia but also regionally. Vodafone Egypt is the leading player in the Egyptian mobile market and we look forward to contributing further to its continuing success in case the deal is sealed.” 

The deal is expected to be finalized by June 2020, pending due diligence and various regulatory approvals, the two companies confirmed.

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