Orascom withdraws case against France Telecom
CAIRO: Egypt's Orascom Telecom Holding S.A.E. said Sunday it was dropping its case against France Telecom over ownership stakes in Mobinil, the country's largest mobile phone service provider.
The statement by Orascom was the latest development in a festering dispute between it and Paris-based FT over the sale of Mobinil - an argument set in motion by an arbitration court ruling in favour of France Telecom.
In a statement Sunday, Orascom said the case it filed in May in a Cairo court is "no longer necessary in light of recent public pronouncements by FT, which make it clear that ... FT has no intention of extending a public tender offer on the same terms as those contained in the Award." The two companies have accused each other of failing to comply with the terms of an arbitration court ruling that required Orascom to transfer its shares in Mobinil Telecom, a holding company which owns a 51 percent stake in the Egyptian Company for Mobile Services, Mobinil's operator.
Orascom, backed repeatedly by Egypt's regulatory body, the Capital Markets Authority, said the arbitration order meant FT must buy all of Mobinil, and offer all the shareholders the same price.
It valued the deal at about $1.7 billion.
FT initially disputed that it must submit a 100 percent mandatory tender offer, or that the offer must be at one price. It then said OT had failed to comply with the arbitration court's 30 day deadline to transfer the shares.
OT said it was ending the legal action as "an amicable gesture to focus attention on the business of running Mobinil." The Egyptian telecom giant said it "reserved all its rights, including its claim for damages, but hopes that further litigation can be avoided."