Algeria determined to buy Djezzy mobile phone firm

, Comments 0 comments

Algeria said Sunday it was determined to buy Algerian mobile operator Djezzy which is currently being acquired by Norwegian-Russian telecoms giant Vimpelcom as part of a major takeover deal.

Vimpelcom said earlier this month it would consider selling Djezzy to Algeria after it acquired control of parent firm Orascom in a multi-billion dollar deal with Egyptian billionaire owner Naguib Sawiris.

The Algerian government has said it plans to nationalise Djezzy as part of a dispute over tax and outstanding debt.

"Algeria will definitely buy this unit. We are dealing with only one interlocutor, Orascom Telecoms Holding (OTH)," Prime Minister Ahmed Ouyahia told parliament.

The "state will buy Djezzy whatever the obstacles," the premier said, noting that there had been much discussion about the 7.8 billion dollar price tag put on Djezzy by Vimpelcom owner Alexander Izosimov.

"We will call in international experts to give us a valuation on Djezzy," he said, adding that the mobile company still has many bills unpaid.

OTH's owners "need to put their tax affairs in order," the premier said, with 17 billion dinars (225 million dollars) outstanding as well as debts owed to the telecoms regulator and the costs linked to the closure of the Lacom fixed line business in 2008.

Lacom acquired Algeria's second fixed-lince license in 2005 for 65 million dollars.

OTH has also been accused of fraud by the Bank of Algeria in the transfer of some 190 million dollars, Ouyahia noted.

Local speculation puts the price for Djezzy, the top Algerian telecoms company with 15 million customers, at 3.0 to 3.5 billion dollars.

According to Algerian foreign investment laws, the state must hold 51 percent of any foreign company operating in the country.

Announcing the Orascom deal earlier this month, Vimpelcom chief executive Izosimov said that "if the government insists, we will naturally be ready to consider selling the asset to the government.

"We would with pleasure retain this company ... and manage these assets because no doubt this market has potential," he added on the sidelines of a visit by Russian President Dmitry Medvedev to Algeria.

"For us it is important that relations with the company and the government normalise, to understand what path is chosen."

© 2010 AFP

0 Comments To This Article