Under the terms of the prequalification notice, only companies with three years' experience in mobile telephony, 1 million subscribers and a market capitalisation of $2,000 million - or a net shareholders' equity of $1,000 million - will be eligible to participate in the second stage of the tender process.

The ministry will publish the identity of the shortlisted operators three days after the EoI are submitted and the tender will be launched soon afterwards. The closing date for bids will be 2 December. The selected company will operate the licence for a 15-year renewable term, with an exclusivity period until January 2007.

Algeria already has two GSM providers: state-owned Algerie Telecom, which has around 150,000 mobile subscribers, and private operator Orascom Telecom Algerie (OTA), which has gained some 1 million subscribers since starting operations in February 2002. OTA is the subsidiary of Egypt's Orascom Telecom, which purchased the first private Algerian GSM licence in July 2001 for$737 million (MEED 27:7:01).

Industry analysts say it is exceedingly unlikely that the second licence sale will raise anything near this amount, or draw in big foreign operators. Instead, it is expected that regional telecom operators will be well represented in the bidding.

The government is being advised by a consortium headed by Rothschild (Paris) and including legal advisers Coudert Brothers, and technical consultant ICEA.