TE subsidiary signs agreement to buy MENA for $90M

CAIRO – 21 May 2018: Telecom Egypt (TE) announced that its subsidiary Egyptian International Submarine Cables Company (EISCC) signed an agreement with Orascom Telecom Media and Technology Holding S.A.E (OTMT) to buy its shareholding of its subsidiary Middle East and North Africa Submarine Cable (MENA) for $90 million.

The company said in a filing to the Egyptian Exchange (EGX) that the transaction will be concluded in 60 days, after the fulfillment of all conditions.
It said that the acquisition of MENA Cable matches the company’s strategy to achieve a short-term return from this investment and preserve the revenue stream of the submarine cable systems.

On May 10, TE’s board of directors approved the acquisition of MENA Cable by its subsidiary EISCC with a total enterprise value of $90 million to be financed through a shareholder loan from TE.

EISCC appointed KPMG and First Capital Financial Advisory as the financial advisors of the deal, while Al Tamimi & Co and ALC Law Office were the legal advisors and Metel ICT the technical advisor.

According to the statement, MENA Cable is licensed in Egypt and Italy to operate a submarine telecommunications system connecting Europe to the Middle East and South East Asia.

“The decision to acquire MENA Cable is one of the most important steps towards implementing the company’s strategic plan to ensure the sustainability of submarine cable revenues and reinforce the contribution of the USD revenue stream,” said Ahmed El Beheiry, managing director and CEO of TE.

“The new cable will add to Telecom Egypt’s network of submarine cables fortifying TE’s network offering to the maximum number of routes between India and Europe, as well as add a new gateway to Europe through Italy,” he added.

Established in 1854, Telecom Egypt is a public company, listed on the EGX since December 1999.

It operates within the telecommunication services sector, focusing on integrated telecommunication services, with 17 subsidiaries operating across the British islands, Western Europe, North Africa and the Middle East.