Rinchi
TechInAfrica — Telecom Egypt has just announced the 50% acquisition of its subsidiary Egyptian International Submarine Cable Company (EISCC) with a value of US$15 million. The announcement of the acquisition was made after the approval of its board of directors.
Previously, it also announced that EISCC had completely acquired the Middle East and North Africa Cable (MENA Cable) from Orascom Investment Holding (OIH) with a total value of US$90 million. In August, Telecom Egypt had also signed the MoU with Bharti Airtel allowing Telecom Egypt to bundle assets of its international network with assets on MENA Cable. The deal will also enable Telecom Egypt to recover its whole investment in MENA Cable. Despite the prediction, the deal has been yet to conclude—expected to be decided soon.
The decisions on acquiring the remainder of EISCC have brought some financial advantages to the Telecom Egypt, such as:
- An entire consolidation of MENA Cable benefits from Bharti Airtel transaction
- Prompt savings of US$10 million in consequence of the new structure
- Total acknowledgment of recurring revenue over the lifetime of the cable which at least 15 years in minimum.
The Managing Director and Chief Executive Officer, Ahmed El Beheiry gave his opinion about the acquisition of MENA Cable. He stated:
“The team management has worked hard ever since the early year of 2018 to secure the revenue of its international submarine cable network and had already announced the investors that it is a short-term acquisition of MENA Cable. We have landmarked some of our plans including the conclusion of the MENA Cable acquisition and the MoU signing to restore our investment. Today’s announcement is seen as a very important matter to enable the full consolidation of the asset and the expected revenue over its lifetime. Today’s settlement marks the second fully owned submarine cable by the Telecom Egypt into TE North.”
