SHARM EL-SHEIKH, Egypt, 21 May 2006 — Egypt’s Orascom Telecom will be among bidders for a third mobile phone license in Saudi Arabia, but does not intend to take a large stake, Chairman Naguib Sawiris said yesterday.
Saudi authorities plan to grant new mobile and fixed-line licenses by the end of the year, breaking a monopoly of Saudi Telecom Co. (STC) on landline phone services and adding at least a third mobile phone operator after STC and Etihad Etisalat (Mobily) .
With some 14.5 million mobile lines in a country of around 25 million, Saudi’s wireless segment is set for growth. “We are interested and we are going to bid,” Sawiris told Reuters in an interview at the World Economic Forum in the Red Sea resort of Sharm El-Sheikh in Egypt. “We are not going to disclose how we will bid. But we do not intend to take a major stake, we will take a small stake — this one is going to be expensive.”
The Saudi Communications and Information Technology Commission (CITC) plans to publish the licensing schedule in the third quarter of the year and evaluate, select and award the new licenses by the end of the fourth.
Orascom has expanded rapidly in emerging markets by offering mobile subscriptions at rock-bottom prices but slashing costs to offset the weak revenue.
The strategy has given it the financial muscle to contemplate an assault on lucrative European markets after it acquired a base in Italy by buying local mobile operator Wind.
Orascom controls Italy’s second-biggest mobile phone service provider through Weather Investments, which it aims to float on the stock market, raising about 2 billion euros.