According to Emerging Money, Russian telecom giant Vimpelcom has reportedly signed an agreement with the Algerian government for the country’s telecom unit previously owned by Orascom Telecom, which Vimpelcom purchased last year. The deal is being reported to be as high as $7.8 billion.
Analysts say the sale could help push the Russian company forward on liquidity and give it more options for investment as the company has already said it was looking to enter new markets.
“This is a huge deal and one that will be beneficial to the company, both financially and with investors because of the turmoil over the Algerian unit for the past months,” said Cairo-based securities analyst Hussam el-Mohamed, who had followed the Vimpelcom and Orascom deal closely.
Orascom Telecom Algerie, or Djezzy, is the leader in the Algerian mobile market and boasts some 16 million subscribers. It had been the top unit of the Orascom network and widely considered the reason for VIP’s $8.6 billion acquisition of Orascom.
The Algerian government had demanded Orascom pay $600 million in back taxes, which left the future of the unit in doubt.
Jonathan Terry
