France Telecom has reached a final agreement on terms to increase its stake in Egyptian mobile operator Mobinil. The agreement is in line with the preliminary agreement announced in February with local partner OTMT. France Telecom currently holds 71.25 percent of the MobiNil holding company, while OTMT holds the remaining 28.75 percent. Mobinil subsequently owns 51.03 percent of ECMS, Mobinil's listed holding company, in which OTMT directly owns 20 percent and 29 percent is listed on the Egyptian stock market. FT will launch a tender offer at EGP 202.5 per share for the shares in ECMS, excluding a 5 percent stake which OTMT will retain. OTMT is expected to receive aggregate proceeds of approximately EGP 6 billion for its direct and indirect ECMS stake tendered. After the above transactions, Mobinil will no longer hold any shares in ECMS. OTMT will remain FT's strategic partner and services provider to Mobinil and be able to appoint three of the 13 board members at ECMS. Another three Egyptian citizens will be independent directors. The agreement also includes a number of put and call options for FT to acquire OTMT's remaining stake in the operator from 2015, including pre-emptive rights for the French operator if OTMT gets an offer from another investor. In addition, FT agreed to consider selling up to 15 percent of ECMS' shares to local shareholders, in order to maintain its links with the Egyptian economy. The offer remains subject to regulatory approval.
