Vodafone in talks to sell its 55% Egypt stake

Cairo:  Vodafone Group Plc is in talks to sell its 55 per cent stake in Vodafone Egypt Telecommunications Co, a person familiar with the matter said. The stake is valued by analysts at about £3 billion (Dh15.8 billion).

Telecom Egypt, which already owns 45 per cent of Egypt's second-largest mobile phone operator, approached Vodafone about the stake, the person said, declining to be identified because the talks are private. Negotiations are at an early stage and no accord has been reached, the person said.

"We estimate that Telecom Egypt that has no debt could and should pay in the region of £3 billion for Vodafone's stake in Vodafone Egypt," Robin Bienenstock, an analyst at Sanford C Bernstein Ltd, said in an e-mailed note.

Priority areas

Vodafone Chief Executive Officer Vittorio Colao said last week that Europe, sub-Saharan Africa and India were the three "priority areas" for the world's largest mobile-phone company. He said the company would focus its investments on those areas. Vodafone spokesman Ben Padovan declined to comment.

"Telecom Egypt is looking to increase its exposure to the mobile-phone market and is considering all available options," Chief Executive Officer Tarek Tantawy said in an interview. "But no decision has been taken by the board."

Asked if one of the options is to buy the remaining stake in Vodafone Egypt, Tantawy declined to comment. Fixed-line monopoly Telecom Egypt started talks with Vodafone about a month ago, the Financial Times reported late Thursday.

Shares of Vodafone, based in Newbury, England, rose as much as 2 pence, or 1.5 per cent, to 131.45 pence, and traded at 131.35 pence in early London trading.

Vodafone said last week it will increase annual dividend payments by at least 7 per cent for the next three years.