Phuthuma Nhleko, departing Chief Executive Officer of MTN South Africa, said that he regrets not moving forward on a failed plan to purchase assets from Egypt’s Orascom Telecom. He did add that the deal could return to the table and he hopes the company will take it.
The Orascom deal, he told reporters, was “far more definitive than MTN’s failed bid to merge with India’s Bharti Airtel and was hampered because of a regulatory issue in Algeria,” the CEO said.
According to Hussam Abdel Razak, a securities and telecom expert in Cairo, the deal should have gone through and he is unsure why MTN failed to capitalize on the acquisition, citing the possibility of Egyptian officials not backing the move.
“We often see a number of deals fall through in Egypt because of government officials who for some reason want to ensure companies maintain their Egyptian base,” he began. “This has been a major inhibitor in the past and we believe that some officials did not want to see a South African company move in and be a part of Egypt’s top mobile operator.”
For now, the deal is dead, but according to Nhleko and Abdel Razak, the transaction could see new light in the post-revolution Egypt.
“It might be a bit early, but my guess is they will work something out,” Abdel Razak added.
By Jonathan Terry
