29th Jan 2020 08:23
(Alliance News) - Vodafone Group PLC on Wednesday said it has agreed a deal to sell its majority 55% holding in its Egypt business to Saudi Telecom Co for USD2.39 billion.
The deal gives Vodafone Egypt an enterprise value of USD4.35 billion. The FTSE 100 firm said that despite the disposal, it will continue to have a "significant presence in Egypt", including a partnership agreement with stc.
Vodafone said: "The parties have agreed the basis for a long-term partner market agreement, which will include use of the Vodafone brand, preferential roaming arrangements, access to Vodafone's central procurement function, and a range of other services.
"This agreement will ensure that Vodafone Egypt will be able to continue to offer its business and consumer customers world-class services and innovations."
The transaction is expected to close in June 2020, following regulatory approval.
Vodafone Egypt contributed EUR1.11 billion in revenue to the telecommunications firm in the year to March 2019.
Vodafone Chief Executive Nick Read said: "I am deeply proud of our business in Egypt, being the clear number one leader in the market. Under stc, I believe they will continue to flourish.
"This transaction is consistent with our efforts to simplify the group to two differentiated, scaled geographic regions - Europe and sub-Saharan Africa. Additionally, it will reduce our net debt and unlock value for our shareholders. We look forward to continuing our close relationship with the business through a partner market agreement."
The latest disposal follows Vodafone in December announcing that it agreed to sell its Malta unit to Monaco Telecom SAM for EUR250 million.
The company completed the disposal of its New Zealand unit in July for EUR2.0 billion to a consortium featuring investment firm Infratil Ltd and Canadian alternative asset manager Brookfield Asset Management Inc.
Vodafone shares were marginally lower at 156.62 pence each shortly after market open in London on Wednesday, having started slightly higher.
By Eric Cunha; [email protected]
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