Shortlist announced for telecoms privatisation

23 May 2003
Six international telecoms companies have been prequalified by the Higher Council for Privitisation (HCP) to take part in the auction of two GSM mobile phone networks and related 20-year licences. A seventh firm has been selected along with the six to bid for a separate three-year contract to manage Lebanon's two existing networks (MEED 11:4:03).

The six shortlisted for the GSM licence auction and management contract are the local Libancell, Luxembourg's Investcom Holding, France's Orange, Greece's OTE, and Kuwait's National Mobile Telecommunications Company (Watiniya) and Mobile Telecommunications Company (MTC). Germany's Detecon, which was not interested in the licence sale,has been prequalified to bid for the management contract. The selctions were announced after a mid-May meeting between the HCP and its adviser HSBC

Details of the license auction and management tender will be announced once HSBC has finalised rules for the two competitions and access to existing data. A bidding schedule has still to be fixed.

Beirut hopes to raise as much as $2,000 million from the sale of the two licences to reduce its $31,000 public debt. There are over 800,000 mobile subscribers in Lebanon with a further increase anticipated. The total revenue from this network is estimated at more than $550 million a year.

The licences will replace two 10-year build-own-operate (BOT) contracts held by GSM operators Cellisand LibanCell, which were due to run until 2004 but were cancelled by the government in 2001. Last December, the two companies finally agreed to transfer the networks to the state after the government suspended its demand for $600 million in fines for contract violations and agreed to pay $178 million in compensation (MEED 16:12:02).

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