The demerger of Orascom Telecom Holding’s (OTH) telecoms assets has been delayed as a result of hold-ups caused by Egypt’s uncertain political situation, according to sources close to the company.
Most recently, the government has requested some additional documents from OTH before it can approve the demerger.
“The demerger was approved by 97 per cent of the shareholders in the general assembly, but now the paperwork has taken longer than expected due to the situation in Egypt,” says Khaled Bichara, chief executive officer of OTH.
The demerger was expected to have been completed by the end of June this year, but Bichara is optimistic it could happen by the end of September.
“The situation is tough at the moment, but we do not see any technical or fundamental issues, the approval of documents are ready,” he adds.
The demerger plan is a result of Russian’s Vimpelcom acquiring OTH’s telecoms assets in March. Under the terms of the plan, Vimpelcom will take on those assets, and a new company, Orascom Telecom Media and Technology Holding (OTMT) will be created to hold the remaining assets. These include Egyptian Company for Mobile Services (Mobinil), CHEO Technology Joint Venture Company (Koryolink) in North Korea and Orascom Telecom Ventures, as well as other investments in the technology sectors, including marine cable assets.
The company is listed on the Egyptian Exchange and the London Stock Exchange (LSE).