Irancell network set for $1.5bn of awards

06 January 2006
Irancell is expected to award contracts worth $1,500 million in January for the supply and installation of equipment for its new GSM network - the first private mobile phone network in Iran. The company signed the licence agreement to develop the network in late November after formally establishing the new operator between its local and South African partners (MEED 16:12:05).

In an exclusive interview with MEED, Irancell chairman Ebrahim Mahmoudzadeh on 20 December said he hoped to make the awards by mid-January (see the Iran Special Report in MEED 6:1:06 for the whole interview). The work will involve the installation of switching centres, base stations and transmission centres and is to be divided into six different regions - Tehran, Tabriz, Hamadan, Mashad, Isfahan and Shiraz. Mahmoudzadeh said it was possible that each region would be awarded to a different consortium.

Six international equipment suppliers - France's Alcatel, Sweden's Ericsson, Finland's Nokia, Germany's Siemens and Huawei and ZTE Corporation, both of China - are bidding for the work. Each foreign bidder must team up with a local partner and 51 per cent of the equipment must be manufactured locally. The Irancell network will come into operation between June and September 2006 and is targeted to reach 2.7 million subscribers by the end of the first year, rising to 9.7 million by the end of the third year.

Irancell is a consortium of South Africa's MTN and Iran Electronic Industries (IEI), itself a partnership between Defence Industries subsidiary Sa Iran and Mostazafan & Janbazan Foundation. MTN replaced Turkcell as the 49 per cent foreign partner after the failure of two years of negotiation with the local partners this autumn. Turkcell said it was illegally cut out of the selected consortium, which it had originally led.

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