Telecom Egypt (TE) announced on Monday it has concluded the acquisition of the Middle East and North Africa Submarine Cable (MENA Cable) from Orascom Investment Holding (OIH) through its subsidiary Egyptian International Submarine Cable Company (EISCC) at a total value of $90 million. The acquisition of MENA cable system was approved by its Board of Directors in May 2018.
The total transaction value of MENA Cable is USD 90mn, including USD40mn for the equity value of MENA Cable System and USD50mn for its outstanding debt.
EFG Hermes acted as the brokerage company for executing the transaction on Telecom Egypt’s side.
“The decision to acquire MENA Cable is a result of our vision to achieve a short-term return from this transaction capitalizing on the growing data demand from India,” managing director and CEO of TE Ahmed El Beheiry commented.
In August, Telecom Egypt and Bharti Airtel reached strategic partnership for global submarine cable systems, wherein, Telecom Egypt will bundle MENA’s assets with existing assets of the TE network. Airtel will be granted IRUs (Indefeasible Right of Use) on MENA Cable and TE North cable systems as well as large capacities on a long-term basis on two new cable systems (SMW5 & AAE1).
Telecom Egypt expects to formalize the partnership with Airtel into an agreement soon, which will enable Telecom Egypt to recover all of its investment in MENA Cable.