Orascom Telecom sees arbitration on Algeria unit-CNBC
OT reluctantly agreed to talks on the nationalisation of Djezzy after Algeria hit the unit with back-taxes.
December 28, 2010 3:59 by Reuters
Orascom Telecom (OT) will seek international arbitration soon in a dispute with Algeria’s government over the Egyptian company’s unit Djezzy, OT’s chairman was quoted as saying on CNBC Arabia TV’s website.
A planned $6.6 billion sale of OT assets to Russia’s Vimpelcom has been complicated by the spat with Algiers over the future of Djezzy, OT’s biggest revenue generator.
OT reluctantly agreed to talks on the nationalisation of Djezzy after Algeria hit the unit with back-taxes, stopped it moving money abroad and blocked a sale to South Africa’s MTN .
“We will resort to international arbitration to resolve the problem of the Djezzy unit and will start the procedures soon,” CNBC Arabia quoted Naguib Sawiris on Tuesday as saying.
An OT official declined to comment on the CNBC report.
Its Chief Executive Khaled Bichara said last month OT would only seek international arbitration as a last resort.
Algeria’s government has said it will pay a market price for Djezzy but has not said exactly when an offer would be made.
OT shares were unchanged in Cairo. The benchmark index was up 0.9 percent.
(Reporting by Marwa Rashad and Yasmine Saleh; Writing by Tom Pfeiffer; Editing by David Holmes)