Egypt’s Global Telecom in for $600m buyout

Traffic on 6th October bridge and Ramses Street in Cairo. Egypt’s blue-chip index has risen for a ninth straight session, with 27 of its 30 stocks up. (AFP)
Updated 06 February 2019

Egypt’s Global Telecom in for $600m buyout

  • Veon’s offer for the stake in Global, formerly known as Orascom, represents a 20 percent premium to its closing price on Monday and is worth $600 million
  • Veon, based in Amsterdam, operates telecommunications companies in Russia and in developing countries in Asia and North Africa

AMSTERDAM/CAIRO: Telecoms operator Veon said on Tuesday it intends to offer 5.30 Egyptian pounds ($0.3005) per share for the 42.3 percent of Cairo-listed Global Telecom Holding it does not already own.
The offer for the stake in Global, formerly known as Orascom, represents a 20 percent premium to its closing price on Monday and is worth $600 million.
Veon, based in Amsterdam, operates telecommunications companies in Russia and in developing countries in Asia and North Africa. It holds a 55.6 percent stake in Global, which operates the Djezzy network in Algeria, Mobilink in Pakistan and Sheba Telecom in Bangladesh.
Veon said in a statement it has not yet submitted the offer to Egyptian financial authorities and it would not comment further. It called off a previous attempt to buy out Global’s assets in October.
Meanwhile, the International Monetary Fund will conduct its final review of Egypt’s three-year $12 billion loan program in June, Finance Minister Mohamed Maait said on Tuesday.
The IMF announced on Monday that it was disbursing the fifth out of six $2 billion tranches, after completing its fourth review of the program.
Foreign investors hold $13.1 billion in Egyptian treasuries, Deputy Finance Minister Ahmed Kouchouk said on Tuesday.
Kouchouk had last put the figure at $14 billion as of end-September, after a turbulent summer for emerging markets with weakened investor appetite.
Foreign investors bought Egyptian treasury bills and bonds worth $900 million in January, Maait said.
The average yield on bonds in the period from July until December was 18.5 percent, and the average yield on treasury bills sold in the same period was 19.5 percent, Kouchouk said.


Oil up after drone attack on Saudi field, but OPEC report caps gains

Updated 15 min 44 sec ago

Oil up after drone attack on Saudi field, but OPEC report caps gains

LONDON: Crude oil prices rose on Monday following a weekend attack on a Saudi oil facility by Yemen’s Houthi militia and as traders looked for signs of progress in US-China trade negotiations.
Price gains were, however, capped to some degree by an unusually downbeat OPEC report that stoked concerns about growth in oil demand.
Brent crude, the international benchmark for oil prices, was up 85 cents, or about 1.4%, at $59.49 a barrel at 1225 GMT.
US West Texas Intermediate (WTI) crude futures were up $1.01, or 1.8%, at $55.88 a barrel.
A drone attack by the Iran-backed Houthi militia on an oilfield in eastern Saudi Arabia on Saturday caused a fire at a gas plant, adding to Middle East tensions, but state-run Saudi Aramco said oil production was not affected.
“The oil market seems to be pricing in again a geopolitical risk premium following the weekend drone attacks on Saudi Arabia, but the premium might not sustain if it does not result in any supply disruptions,” said Giovanni Staunovo, oil analyst for UBS.
Iran-related tensions appeared to ease after Gibraltar released an Iranian tanker it seized in July, though Tehran warned the United States against any new attempt to seize the tanker in open seas.
Concerns about a recession also limited crude price gains.
Meanwhile, China’s announcement of key interest rate reforms over the weekend has fueled expectations of an imminent reduction in corporate borrowing costs in the struggling economy, boosting share prices on Monday.
US energy firms this week increased the number of oil rigs operating for the first time in seven weeks despite plans by most producers to cut spending on new drilling this year.
“WTI in recent weeks has performed relatively better than Brent... Pipeline start ups in the United States have been supportive for WTI, while the ongoing trade war has had more of an impact on Brent,” said Warren Patterson, head of commodities strategy at Dutch bank ING.
The Organization of the Petroleum Exporting Countries (OPEC) cut its forecast for global oil demand growth in 2019 by 40,000 barrels per day (bpd) to 1.10 million bpd and indicated the market would be in slight surplus in 2020.
It is rare for OPEC to give a bearish forward view on the market outlook.
“Such a bearish prognosis will heap more pressure on OPEC to take further measures to support the market,” said Stephen Brennock of oil broker PVM.