OT redraws its foreign frontiers

23 July 2004
Cairo-based Orascom Telecom(OT) is in the process of consolidating operations in three countries on the furthest borders of its international empire, capping a year in which total subscriber numbers grew by 92.8 per cent to reach 9.3 million for the 12 months ending 30 June. Net income for the first quarter reached£E 473 million ($76.6 million), compared with£E 102 million ($16.5 million) for the same period in 2003. A financial statement for the six-month period ending 30 June is expected in late August.

The company has suspended its operations in Chad after failing to resolve a dispute over the TchadMobilenetwork, which is OT's smallest operation with less than 40,000 subscribers. The dispute arose after the local Telecommunications Ministry invalidated the transfer of 51 per cent to the OT holding company, claiming that the previous owner, fixed-line operator Sotel, had been unauthorised to make the 2002 sale (MEED 14:5:04).

OT has agreed terms to renew the licence of its Mobilinksubsidiary in Pakistan for 15 years. Its current licence expires in July 2007, at which point OT will be required to pay $145.5 million, or 50 per cent of the agreed licence fee, with the remaining amount to be paid in 10 annual instalments. Pakistan is one of OT's fastest-growing operations, with annual growth of more than 160 per cent to 3 million subscribers. However, negotiations with the government for a 26 per cent stake in fixed-line operator Pakistan Telecomare now understood to be on hold (MEED 22:8:03).

OT has also seen modest growth in Iraq, where its Iraqnaoperation had registered 216,459 subscribers by the end of June. 'We aim to have about 500,000 subscribers by the end of the year, but we are unable to go for an aggressive rollout strategy due to the security problems - our staff come first,' says an OT official (MEED 31:10:03).

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