Algeria Plans to Acquire Djezzy

The Algerian government is poised to make an offer to buy Orascom Telecom's Djezzy mobile phone unit by the middle of next year, Reuters reports, citing an unnamed Telecommunications Ministry source.

The hotly contested unit has been the source of much speculation in recent years, and came to the fore once again following October’s agreement between Russia's Vimpelcom and Egyptian entrepreneur Naguib Sawiris under which Vimpelcom would take a majority stake in most of Orascom Telecom's units, originally slated to include its most valuable asset Djezzy.

Provisional negotiations between Vimpelcom and Algiers over the potential privatisation of Djezzy stalled, and the Algerian government forced Orascom’s hand by hitting the telecoms firm with substantial back taxes.

Last week Algiers demanded a figure of around USD230 million for the tax years ending 2008 and 2009; Orascom has called the reassessment ‘completely unfounded’. In November Algeria's Finance Ministry shortlisted ten firms to provide it with a valuation of Djezzy, with the results anticipated to be available before end-2010. The Algerian telecoms official, speaking on condition of anonymity, told Reuters: ‘I think Algeria will make an offer to Djezzy by the end of June 2011’.
Although Vimpelcom has expressed its desire to acquire Djezzy throughout, its plan suffered a major setback yesterday when Norwegian shareholder Telenor confirmed that it is not willing to back the acquisition.
 
Telenor, which holds a 36% voting stake in Vimpelcom, is generally perceived as taking a more cautious approach towards international expansion than its co-shareholder, Alfa Group, and its reluctance to push through the Djezzy deal has been rumoured for some time.
 
Telenor spokesman Dag Melgaard commented: ‘In our capacity as a shareholder of Vimpelcom Ltd., we do not believe this transaction makes strategic or financial sense for Vimpelcom's shareholders’.
 
In a subsequent press statement Vimpelcom confirmed: ‘Six of nine directors, including all three independent directors and the three Altimo-nominated directors, voted in favour of the transaction, with the Telenor-nominated directors voting against the transaction. The supervisory board did not approve an amended shareholder agreement, or vote on other shareholder-related agreements due to Telenor’s publicly stated position that, in its capacity as a shareholder of Vimpelcom, it does not support the transaction’.

Zamtel Spends US$34 Million In Fibre-Optic Project

Zambia’s monopoly fixed line operator Zambia Tele- communications Company (Zamtel) claims to have spent approximately USD34 million on laying fibre-optic cable across the country, AllAfrica reports.

The investment figure was revealed by Transport and Communications Deputy Minister Mubika Mubika in Parliament, who in responding to questions about the telco’s future spending plans noted that it remained unclear whether Libya’s LapGreen Networks, which recently acquired a 75% stake in Zamtel, would continue the current fibre rollout project.

LapGreen Networks submitted a USD257 million for the majority stake in Zamtel, and it was announced last month that it had beaten out bids from Russian telecoms investment firm Altimo and Unitel of Angola for the majority holding to win the holding. The government meanwhile has retained the remaining 25% stake, although it may sell this at a later stage through an initial public offering on the Lusaka bourse.

Three Remain for Telcos Zamtel Bid

Of the four companies left in the running to acquire a stake in Zambian fixed line incumbent Zambia Telecommunications Company (Zamtel) only three have submitted final binding bids, with Indian state-owned telco Bharat Sanchar Nigam Ltd (BSNL) dropping out of the process after conducting due diligence.

According to Reuters, the withdrawal of BSNL leaves Libya’s LAP Green Networks, Unitel of Angola and Russian telecoms investment firm Altimo chasing the up to 75% stake that the Zambian government plans to offer in the operator.

Commenting on the development, Henry Sakala, the privatisation manager at the Zambia Development Agency (ZDA), said: ‘These bids will be subjected to an evaluation by the ZDA and after the evaluation they will be presented to the ZDA board who are going to make a decision as to which ones to shortlist for negotiations.’ In addition Sakala noted that the ZDA board would appoint an independent team to undertake the negotiations with the successful bidder(s).

Zambia Plans To Transfer Fibre Lines From Zesco to Zamtel

AllAfrica.com reports that the Zambian government is planning to put a number of fibre pairs currently controlled by state-owned power company Zesco in to the hands of Zambia Telecommunications Company (Zamtel). It is understood that the move is part of the state’s plans to make the telco more attractive to potential buyers, as the privatisation process of the operator moves forward.

Under the proposals the government will transfer seven of twelve fibre pairs that Zesco has; of the remaining five, two are used by Zesco to manage its power network, one is used by South Africa-based MTN, which owns a mobile operator in Zambia, while the last two are not currently in use.

Local ISPs have voiced their concerns about the proposals however, with one unnamed market operator stating: ‘All the ISPs don't want this to happen. We have a good relationship with Zesco and we put a lot of capacity through their link. If it happens, I'll have to lay fibre routes and that's not my business. We're looking at VoIP offerings because the current prices of international calling are still USD1.10-USD1.50 a minute.’

At present Chinese vendor Huawei is in the process of rolling out a fibre backbone for Zamtel, but it remains incomplete and by comparison to Zesco’s existing infrastructure is significantly less expansive. Zesco’s fibre network spans the economically active central part of the country from Lumwana and Solwezi in the north to Sesheke in the south.

The Zambian government first announced plans to divest a portion of its stake in Zamtel in December 2008. In September 2009 it revealed it would sell 75% of the struggling operator, and one year after initially unveiling its intention to sell, the Zambia Development Agency (ZDA), which is handling the process, announced the shortlist of bidders: India's Bharat Sanchar Nigam Ltd, Unitel of Angola and Libya's LAP Green Networks. Russia’s Altimo was subsequently added to the list, despite submitting its bid after deadline.

Four Listed For Zamtel Acquistion

Four bidders have been shortlisted to take a 75% stake in the state-owned telco, Zamtel. The bidders who shall proceed to the next round are India's BSNL, Libya's LAP Greencom, Unitel /Angola Cables of Angola and Russia's Altimo Holdings/VimpelCom.

The ZDA Board at meeting held on January 11, 2009 approved the recommended shortlist after detailed analysis conducted by an Evaluation Committee.

Commenting on the shortlist at a press briefing to announce the successful bidders, Mr. Muhabi Lungu, Acting Director General of the ZDA said he was happy with all four participants who have gone through to the next stage of the process. "The bids submitted were compelling, and set the stage for an exciting next phase," he added.

The four bidders will now be invited to participate in the next round of bidding, which is expected to begin during the week commencing 18 January, 2010. At the begining of this phase shortlisted bidders will be given details of the requirements and timing for the next phase of the process. Details of the bids will not be disclosed at this stage as doing so would prejudice future phases of the privatisation process.

Four ZAMTEL Bidders Submit Bids

Of the eight companies shortlisted in the sale process of a 75% stake in Zambian fixed line incumbent Zambia Telecommunications Company (Zamtel), only three have submitted bids. According to the Times of Zambia the three foreign companies to submit their offers to the Zambia Development Agency (ZDA) for the telco are India’s Bharat Sanchar Nigam Ltd (BSNL), Unitel of Angola and Libya-based LAP Greencom.

A fourth bid, from a consortium of Russia’s Vimpelcom and the telecoms arm of the Alfa Group, Altimo, was understood to have been sent on time, but reportedly arrived at the ZDA offices five minutes after the submission deadline as a result of ‘logistical reasons’. The bid however was still considered, and the ZDA board confirmed that Altimo’s non-binding offer had been accepted today. The four companies that had been shortlisted but chose not to bid were Telkom South Africa, BSNL’s fellow state-owned Indian telco Mahanagar Telephone Nigam Ltd (MTNL), Portugal Telecom and a consortium of Egypt-based Orascom Telecom and its subsidiary Telecel Globe.

ZDA acting director general, Muhabi Lungu, after opening the bids said the ZDA would now study the offers, while also passing the details on to the board of Zamtel for its evaluation. Mr Lungu has stated that the ZDA will announce which of the companies will move on to the next stage in the sale process on 11 January 2010, where another due diligence would be undertaken before the successful bidder is chosen.