Vodafone Group and STC remained in talks over the sale of the former’s majority stake in its Egypt business, despite the deadline on the original offer agreement expiring last week.
In separate statements, the two said dialogue was open with STC blaming “misalignment with relevant parties” for failing to finalise the agreement to buy the 55 per cent stake in Vodafone Egypt by the deadline.
Vodafone Group said due diligence on the sale had been “substantively completed” with the hope the transaction would go ahead in the near future: “Vodafone now looks to STC and Telecom Egypt to find a suitable agreement to enable the transaction to close.”
It holds a 55 per cent stake in the operator, with state-owned Telecom Egypt owning 45 per cent. A 0.13 per cent stake is held by other investors.
Following Vodafone’s comment noting its major partner had a part to play in helping close the deal, Telecom Egypt said it was yet to receive a proposal from either party and had no insight into any terms being discussed. “The inference that Telecom Egypt has a role to play in assisting Vodafone Group and STC to conclude a transaction is unclear and without foundation.”
Vodafone Group and STC signed a memorandum of understanding for the $2.4 billion stake sale in January [1], with an expected closing date of end-June. After being pushed back twice [2] due to issues around Covid-19 (coronavirus), the agreement finally expired last week.
Rumours emerged earlier this month claiming STC was seeking to negotiate a price cut [3] on the original deal.
[1] https://www.mobileworldlive.com/featured-content/top-three/vodafone-poised-to-sell-egypt-unit-to-stc
[2] https://www.mobileworldlive.com/featured-content/top-three/stc-suspends-vodafone-egypt-finance-talks
[3] https://www.mobileworldlive.com/featured-content/home-banner/stc-seeks-cut-price-vodafone-egypt-deal
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