Djezzy valued at $7bn says report
Cairo, September 19, 2011
Orascom Telecom climbed 10 per cent after an Egyptian newspaper reported that a law firm charged with valuing the company's Algerian unit said Djezzy was worth $7 billion, traders said.
Djezzy, Orascom's Algerian unit and its single biggest source of revenue, has been locked in a dispute with Algeria over back taxes since 2009 and has come under increasing regulatory pressure. Algeria has said it wanted to buy the unit.
Al-Borsa newspaper, citing an unnamed Orascom Telecom source, said that Shearman & Sterling LLP, the law firm hired by the Algerian government, had submitted the valuation.
When asked about the report, Orascom Telecom executive chairman Khaled Bichara told Reuters: "We have not received any official information on (the evaluation of) Djezzy. We cannot comment on rumours or news published in newspapers."
Orascom shares were up 10 percent at 3.53 Egyptian pounds ($0.59) by 1107 GMT.
"We are still waiting on confirmation of the news. But if it is real then this is an extremely positive valuation," said Margo Moussa, an analyst at Arab Finance Brokerage.
Analysts have said there could be more room to resolve the dispute over Djezzy since the merger of Orascom's parent firm, Wind Telecom, with Russian operator Vimpelcom and after a popular uprising swept out President Hosni Mubarak's government in Egypt.
Vimpelcom said in April it would seek talks with Algeria on Djezzy following the more than $6 billion cash-and-shares deal to buy Wind Telecom assets including a 51 percent stake in Orascom. - Reuters