Orascom eyes midsized merger, Bouygues says 'non'
Published: 27 November, 2009
READ MORE: M&A | Europe | Orascom Telecom | Bouygues Telecom
Naguib Sawiris, the chairman of dynamic international telecoms player Orascom, is looking for a merger partner for the Egypt-based company, which aims to be a powerhouse around the Mediterranean and in Africa/Middle East. He hinted at France's third operator Bouygues Telecom - under pressure now a fourth 3G player is to be allowed - as a possible candidate, but the French firm denied any such plans.
Sawiris has talked for several years about wanting a tie-up with another operator to accelerate its expansion, and at one time was seen as a possible partner for a multinational like Vodafone, as well as having a shortlived joint venture with Hutchison Telecom in emerging markets. But now Orascom is ruling out a mega-merger and eyeing midsized merger partners.
In an interview with French newspaper La Tribune, Sawiris said he aimed to have a merger completed by 2011 and named Buoygues as a possible partner - along with six or seven other medium carriers in Europe or emerging economies - while ruling out larger possibilities such as AT&T, China Mobile or Telefonica. "We are not in talks with Bouygues about Bouygues Telecom. We would be interested if they had the intention to sell," he said in the interview.
One reason for the interest in Bouygues would be the recent breakdown of talks between Orascom and Iliad, about a possible joint bid for the fourth French wireless license. Sawiris added that he is not ready to exit Mobinil, the cellco at the center of a dispute between joint shareholders Orascom and France Telecom. "If I was legally forced to sell my parts, I would do it. If the price proposed by France Telecom was fair, I would think about the questions," he said.
A French position would strengthen the strategy of creating a pan-Mediterranean entity and roaming bloc. It would "reinforce our presence in the Mediterranean, improve our roaming possibilities, there would be many synergies," Sawiris said. Orascom already operates in a number of markets around the Med, including Egypt, Algeria and Tunisia, and has stakes in the Wind cellco in Italy and Greece (it also has activities in some other markets such as Pakistan).
Meanwhile, a Bouygues spokesperson told Dow Jones: "Selling Bouygues Telecom is not on the agenda."
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