Tuesday, August 21, 2007
Asiacell plans $300mn Iraq expansion
Telecommunications
(Reuters) - Asiacell Communications Co., an affiliate of Qatar Telecommunications Co. (Qtel), could spend as much as $300 million a year to expand its Iraq network, a shareholder said on Sunday. Asiacell paid $1.25 billion for one of three mobile licences sold last week and could consider a bid for the Iraq assets of Egypt's Orascom Telecom, which dropped out of the auction at the eleventh hour.
Orascom and two Kuwaiti operators, Mobile Telecommunications Co (MTC) and National Mobile Telecommunications Co., set up networks in Iraq after the U.S-led invasion that toppled Saddam Hussein in 2003. Qtel bought a majority stake this year in National Mobile Telecommunications, which set up its Iraq operations through a separate affiliate, Asiacell Cayman Islands.
MTC and Kurdish operator Korek won the other two licences.
Asiacell Communications is looking to raise conventional or Islamic debt to fund expansion in Iraq, said Basil al-Rahim, managing partner of UK-based investment bank Merchant Bridge, which holds a 19 percent stake in Asiacell Communications. "The rough ratios of what you spend per subscriber per year is anywhere between $120 to $127 per subscriber. Then you have the upgrade of old equipment and security, so it could be $200 to $300 million a year."
Orascom and two Kuwaiti operators, Mobile Telecommunications Co (MTC) and National Mobile Telecommunications Co., set up networks in Iraq after the U.S-led invasion that toppled Saddam Hussein in 2003. Qtel bought a majority stake this year in National Mobile Telecommunications, which set up its Iraq operations through a separate affiliate, Asiacell Cayman Islands.
MTC and Kurdish operator Korek won the other two licences.
Asiacell Communications is looking to raise conventional or Islamic debt to fund expansion in Iraq, said Basil al-Rahim, managing partner of UK-based investment bank Merchant Bridge, which holds a 19 percent stake in Asiacell Communications. "The rough ratios of what you spend per subscriber per year is anywhere between $120 to $127 per subscriber. Then you have the upgrade of old equipment and security, so it could be $200 to $300 million a year."
Labels: Asiacell, Korek, Merchant Bridge, MTC, Orascom, Qtel
Monday, August 20, 2007
Orascom considers sale of or joint venture for Iraqna
Telecommunications
(Reuters) - Egypt's Orascom Telecom said on Sunday it may sell its Iraqi subsidiary after it dropped out of a race for a long-term mobile licence in the war-torn country. Orascom also said it would not submit another bid to acquire Egyptian communications and technology firm Raya after the firm rejected Orascom's first offer.
Orascom, which had operated the subsidiary, called Iraqna, under a short-term licence after the invasion in 2003, said the $1.25 billion price and 18 percent revenue sharing for a longer-term licence in Iraq were too high. Iraq sold three 15-year mobile licences for $3.75 billion to Kuwait's Mobile Telecommunications Co., Asiacell, and Korek last week.
"(Orascom) is currently evaluating alternatives to monetize the assets of Iraqna including sale or joint venture," the firm said in a statement. Company officials declined to give more details. Iraqna, the first company to provide a full mobile phone service in Baghdad after the 2003 invasion, had around 3 million subscribers, it said on its Web site.
Orascom had invested almost $300 million in Iraqna, which accounted for about 11 percent of its revenues, said Walaa Hazem, telecom analyst at HC Securities in Cairo. Potential buyers could be Asiacell or Korek, who are likely to prefer buying an existing operator rather than set up new infrastructure, Hazem said. Asiacell began operating in the Kurdish north of Iraq in 1999. Korek Telecom is based in the city of Irbil in Iraqi Kurdistan.
Iraqi mobile use rose to 8 million out of a population of 26 million at the end of 2006, from virtually nothing three years earlier, according to officials. Orascom also said it would not raise its bid for Raya, an information technology provider, from 12 Egyptian pounds ($2.12) per share. An independent valuer found the offer undervalues Raya, Egypt's Capital Market Authority said last week. Raya Chairman Medhat Khalil told Reuters on Sunday that OT withdrawal was expected. "It was obvious they were not serious giving the offer at this low price," he said.
Orascom, which had operated the subsidiary, called Iraqna, under a short-term licence after the invasion in 2003, said the $1.25 billion price and 18 percent revenue sharing for a longer-term licence in Iraq were too high. Iraq sold three 15-year mobile licences for $3.75 billion to Kuwait's Mobile Telecommunications Co., Asiacell, and Korek last week.
"(Orascom) is currently evaluating alternatives to monetize the assets of Iraqna including sale or joint venture," the firm said in a statement. Company officials declined to give more details. Iraqna, the first company to provide a full mobile phone service in Baghdad after the 2003 invasion, had around 3 million subscribers, it said on its Web site.
Orascom had invested almost $300 million in Iraqna, which accounted for about 11 percent of its revenues, said Walaa Hazem, telecom analyst at HC Securities in Cairo. Potential buyers could be Asiacell or Korek, who are likely to prefer buying an existing operator rather than set up new infrastructure, Hazem said. Asiacell began operating in the Kurdish north of Iraq in 1999. Korek Telecom is based in the city of Irbil in Iraqi Kurdistan.
Iraqi mobile use rose to 8 million out of a population of 26 million at the end of 2006, from virtually nothing three years earlier, according to officials. Orascom also said it would not raise its bid for Raya, an information technology provider, from 12 Egyptian pounds ($2.12) per share. An independent valuer found the offer undervalues Raya, Egypt's Capital Market Authority said last week. Raya Chairman Medhat Khalil told Reuters on Sunday that OT withdrawal was expected. "It was obvious they were not serious giving the offer at this low price," he said.
Labels: Asiacell, Iraqna, Korek, Orascom, Raya
Thursday, August 16, 2007
Five companies bid for Iraq's mobile phone market
Telecommunications
(AFP) - Five companies began bidding in Amman Thursday for a share of Iraq's lucrative mobile telephone market, one of the few sectors of the war-ravaged economy still producing revenues, officials said. The five include the three existing licence holders -- Orascom, MTC and Asiacell, Iraqi Finance Minister Bayan Jabr Solagh told reporters before the bidding process got underway in the Jordanian capital.
The chief of the National Communications and Media Commission, Siyamend Othman, said the other two companies in the running are Turkcell and Korek, but Solagh would not confirm that. Turkcell is Turkey's largest mobile phone operator and Korek is a regional operator headquartered in northern Iraq's relatively stable Kurdish area.
"There were initially fourteen companies, but five pulled out because of security concerns," Solagh said. "We excluded another four after carefully studying their backgrounds," he added, without elaborating. Solagh said bids would start at 300 million dollars and that the top three tenders would be awarded the contracts.
Egypt's telecom giant Orascom controls Iraq's central region. The south is covered by Atheer, a branch of the Kuwaiti firm MTC, and the north is in the hands of Asiacell, a consortium of Iraqi and Gulf firms. They boast a total of around nine million subscribers. The licences expire at the end of August, and they have been pushing for a speedy issuing of new ones.
The results are expected to be announced on Friday or Saturday. Iraq has limited fixed-line infrastructure, and cellular phones are the main means of communication in the war-torn country. Mobile telephony is one of the few sectors besides oil attracting foreign investment as attacks on telecoms infrastructure are rare.
The chief of the National Communications and Media Commission, Siyamend Othman, said the other two companies in the running are Turkcell and Korek, but Solagh would not confirm that. Turkcell is Turkey's largest mobile phone operator and Korek is a regional operator headquartered in northern Iraq's relatively stable Kurdish area.
"There were initially fourteen companies, but five pulled out because of security concerns," Solagh said. "We excluded another four after carefully studying their backgrounds," he added, without elaborating. Solagh said bids would start at 300 million dollars and that the top three tenders would be awarded the contracts.
Egypt's telecom giant Orascom controls Iraq's central region. The south is covered by Atheer, a branch of the Kuwaiti firm MTC, and the north is in the hands of Asiacell, a consortium of Iraqi and Gulf firms. They boast a total of around nine million subscribers. The licences expire at the end of August, and they have been pushing for a speedy issuing of new ones.
The results are expected to be announced on Friday or Saturday. Iraq has limited fixed-line infrastructure, and cellular phones are the main means of communication in the war-torn country. Mobile telephony is one of the few sectors besides oil attracting foreign investment as attacks on telecoms infrastructure are rare.
The cell phone network companies licensed by the Iraqi government should seek a permit from the region's government to work within the borders of Kurdistan region, Omid Mohammed Saleh, from Iraq's Kurdistan Telecommunication Ministry said on Wednesday. The media spokesman for Kurdistan Telecommunications Ministry also told VOI that his ministry imposes a tax reaching up to $1.75 per subscriber a year.
Labels: Amman, Asiacell, Atheer, Bayan Jabr Solagh, Iraq, Korek, Kurdistan, mobile phone network, MTC, Omid Mohammed Saleh, Orascom, Siyamend Othman, Turkcell
