It is approaching banks to take part in the deal, which is split between local currency and dollar-denominated tranches to help attract local, regional and international finance houses.

Potential mandated lead arrangers are expected to respond to the invitations to join the deal by early November. Syndication is then expected early in the new year.

The mobile operator has appointed Calyon to arrange the financing, which is split into£E 3,000 million ($544 million) and $300 million tranches.

A senior banker close to the deal says although the parent company has a strong financial position, the deal is being structured without any financial guarantees or recourse.

Calyon has been working with the company on raising financing to develop its infrastructure in Egypt for some time, but the decision was taken to delay financing while the telecoms firm builds up its track record of financial results, which will in turn help it negotiate better terms with banks.

Etisalat paid $2,900 million for its Egyptian mobile licence, which it acquired as part of a consortium with National Bank of Kuwait and Commercial International Bank.

The company plans to invest at least $1,000 million in developing a modern telecoms infrastructure in Egypt. It is also considering bidding for the country’s second fixed-line licence, which is being auctioned off by the National Telecommunication Regulatory Authority early in 2008.

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