CAIRO (AP) — The chairman of Orascom Telecom said Monday he has extended for 72 hours the deadline for France Telecom to complete its purchase of Mobinil, the Arab world's largest mobile phone provider by subscribers, or the deal is over.
An international arbitration court had ruled in March that Orascom must transfer to France Telecom (FT) its 28.25 percent stake in Mobinil Telecom, a holding company in which FT owns an 81.75 percent stake.
Mobinil Telecom, itself, holds a 51 percent interest in the Egyptian Company for Mobile Services (ECMS), Mobinil's operator in Egypt.
The deal, however, has hit repeated obstacles as OT and FT argue over whether the Paris-based telecom giant is required to extend a 100 percent mandatory tender offer for all of ECMS. Further complicating the discussions is that FT had proposed two different prices.
In a press conference Monday, Naguib Sawiris criticized what he described as "childish" behavior by France Telecom.
"I didn't want to do this," Sawiris said, referring to the deadline extension. "I was coming today ... to tell you that they did not comply and the ruling is over."
"But we said we would follow legal advice and provide proof of good faith for the last time," Sawiris said, adding that after the April 15 deadline, he would "consider that the arbitration court ruling is null and is no longer binding on us."
Egypt's CMA on April 7 sided with Orascom's interpretation that FT must submit a mandatory tender offer for all of ECMS's shares, which included a 20 percent direct equity stake held by the Cairo-based firm and the remaining 29 percent free floating shares. At a proposed share price of almost 274 Egyptian pounds ($49), the deal was valued at $1.7 billion. FT disputed the interpretation which it said left it "not obliged by law or by market practice to launch a mandatory buyout offer."
Sawiris disputed what he said were claims by FT that Orascom had failed to meet the deadline for transferring its minority stake in Mobinil Telecom, saying that France Telecom itself had failed to present payment for the shares, a step which would have triggered their release.
Sawiris said that while he has no desire to sell the company he built from scratch, he was willing to abide by Arbitration Court of the International Chamber of Commerce's ruling.
However, he ruled out further deadline extensions, saying: "After Wednesday ... if I get 10,000 (Egyptian) pounds per share, I won't sell it."