Telecom Egypt acquires MENA Cable from Orascom Investment for $90M

CAIRO – 17 September 2018: Telecom Egypt announced that its subsidiary Egyptian Submarine Cable Company (EISCC) completed the acquisition of Middle East and North Africa Submarine Cable “Mena Cable” from Orascom Investment Holding “OIH”.

“The total enterprise value of MENA Cable is $90 million of which $40 million represent the equity value of MENA Cable and the remainder represent its outstanding debt,” the company clarified in a filing to the Egyptian Exchange (EGX).

It also noted that EFG Hermes acted as the brokerage company for executing the transaction on Telecom Egypt’s side.

Managing Director and Chief Executive Officer of Telecom Egypt Ahmed el-Beheiry said that this transaction came in line with the company’s strategy to expand its international connectivity to enable Egypt’s vision to become a digital route.

“The decision to acquire MENA Cable is a result of our vision to achieve a short-term return from this transaction, capitalizing on the growing data demand from India,” Beheiry added.

In August, Telecom Egypt signed with India's Airtel Company a memorandum of understanding to enhance cooperation in the maritime cable domain.

As per the memo, the Indian company will get IRUs (Indefeasible Right of Use) on Middle East, North Africa Submarine Cable (MENA Cable) and TE North Cable Systems. In addition, Airtel will take large capacities in two new hi-tech Cable Systems (SMW5 & AAE1) on a long-term basis.

Beheiry said that his company expects to formalize the partnership with Airtel into an agreement soon, which will enable Telecom Egypt to recover all its investment in MENA Cable.

Airtel’s global network portfolio includes ownership of i2i submarine cable system connecting Chennai to Singapore, consortium ownership of SMW4 submarine cable system connecting Chennai and Mumbai to Singapore and Europe, and new cable system investments like Asia America Gateway, India Middle East & Western Europe, Unity, EIG and East Africa Submarine System.

On a different note, the company’s consolidated results slipped 18.2 percent during the first half of 2018, recording LE 2.06 billion, compared to LE 2.52 billion during the same period of 2017.

Telecom Egypt operates within the telecommunication services sector focusing on integrated telecommunication services.

It has 17 subsidiaries operating across British Islands, Western Europe, Northern Africa and Middle East. Telecom Egypt is based in 6th of October, Egypt.