Qatari sovereign wealth fund mulls taking 20% stake in Vodafone Egypt


Reports suggest the Qatar Investment Authority (QIA) is in discussions with Telecom Egypt to acquire 20% of their holdings in Vodafone Egypt

This week, reports suggest that the QIA has entered into discussions with state-run Telecom Egypt to acquire 20% of the latter’s 45% stake in Vodafone Egypt.

The discussions are wider investment by QIA in undisclosed assets owned by the Egyptian state, with a total combined value of around $2.5 billion.

Vodafone Egypt is the largest mobile operator in Egypt with a market share of roughly 43%. Vodafone Group owns a 55% stake in the business, with the remainder held by Telecom Egypt. Telecom Egypt, in turn, is 80% owned by the Egyptian government.

A formal offer has yet to be made, but sources suggest that an agreement could be reached by the end of the year.

Rumours that the QIA was negotiating with Telecom Egypt first began to circulate last month, but the Egyptian operator was quick to deny that discussions were taking place.

The stake sale, if it is agreed, will be the latest step in the thawing of Qatar and Egypt’s frosty relationship. Back in 2017, Egypt, alongside Saudi Arabia, Bahrain, and the United Arab Emirates, severed diplomatic ties with Qatar due to the latter’s alleged support of terrorist organisations.

Money talks, however, and Qatari investments have continued to trickle into Egypt in the past five years. The QIA, for example, already has various investments in Egypt, much of which is centred around the country’s vital tourist trade, which has been heavily impacted first by the pandemic and today by the war in Ukraine.

In closely related news, Vodafone Group itself currently in the process of selling its 55% stake in Vodafone Egypt to Vodacom Group, with the deal being valued at roughly $2.7 billion.

The deal’s journey through the regulatory process in South Africa, however, is taking some time. Recent reports suggest that the deal has received the green light from the National Telecommunications Regulatory Authority but is still awaiting approval from the Financial Supervision Department of the Reserve Bank of South Africa.

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