RIYADH: The Saudi Telecom Company (STC) has said it will need two additional months to close an acquisition deal to buy a 55 percent stake in Vodafone Egypt.
According to a logistics expert, Zael Aldayhani, the delay gives STC time to consider the variables that have arisen due to the COVID-19 pandemic and the changes brought on by the global health crisis.
STC concluded a deal in January to buy the stake for $2.4 billion, then decided in April to extend the process for 90 days due to logistical challenges stemming from the spread of COVID-19.
STC said it would extend the period again — to September — for the same reason. Vodafone Egypt is the largest mobile operator in Egypt with over 44 million subscribers and a 40 percent market share. The Kingdom’s Public Investment Fund owns a majority stake in STC.
Aldayhani said the Saudi-Egyptian deal was encountering difficult times and challenges, significantly the inability of the team to travel and move around.
“Movement and travel is difficult in both countries in the light of the COVID-19 pandemic,” he told Arab News. “Another challenge is the absence of accurate investment forecasts for the sector.”
There are numerous aspects of the deal that should be addressed, a matter that was hard for the time being, and it was natural to extend the period in the present conditions and circumstances. However, this postponement did not mean that the deal had been canceled. Assessment was essential in order to determine the fair price of the shares available for acquisition, he added.
Aldayhani believed that the extension would be beneficial for STC because the company would be able to carefully study the variables that had taken place before and after the pandemic for a more accurate picture.