France Telecom’s Mobinil offer, ruled out by Egyptian court

France Telecom’s offer to buy shares in Egyptian Company For Mobile Services (ECMS), also known as Mobinil, from Orascom Telecom Holding, has been blocked by an Egyptian court.

The court decision leaves Orascom the winner in its appeal over the offer price for the remaining shares in Mobinil, according to news from Total Telecom.

“The court blocks the [Egyptian Regulator’s] ruling that was appealed”, affirmed Hamdy Yassin, the ruling judge at an administrative court in Cairo.

Last year, an international arbitration court ordered Orascom Telecom to sell its stake in Mobinil, at EGP 273 per share. Following the decision, the Egyptian regulator empowered France Telecom to buy the outstanding shares at a price of EGP 245. The offer was taken to court by Orascom, who claimed the selling price was lower than the price set in arbitration.

The two telecom operators are locked in a complicated legal battle for control of ECMS, referred to commonly by its brand name Mobinil. Under the current structure, ECMS is owned 51% by a holding company that is 71.25% controlled by France Telecom’s unit, Orange Participations, and 28.75% by Orascom Telecom. Orascom also controls a direct 20% stake in ECMS.

Osman Mowafi, Orascom Telecom’s lawyer, said that the final ruling pronounced on 10 March, may be appealed in Egypt’s high administrative court.

The Egyptian regulator’s board of directors, who previously approved the France Telecom offer, will meet soon to determine the next steps to be taken and will make a formal announcement in a couple of days, concluded a representative.