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VimpelCom in 'merger talks' with Sawiris
23 August 2010
Orascom and Wind in Europe, the Middle East and north Africa may merge with VimpelCom and Telenor’s operations in Russia and eastern Europe, say reports
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Orascom
Wind
VimpelCom
Telenor
Naguib Sawiris
Egypt
Egyptian billionaire Naguib Sawiris is negotiating to combine the majority of his Orascom telecom assets with Russia’s VimpelCom, according to reports.
He would become a significant minority investor in the new company, which would include his Weather Investments’ 51% hold in Egypt’s Orascom and the Italian mobile operator Wind Telecomunicazioni. Sawiris is restructuring debt and selling assets, says Bloomberg.
VimpelCom and Weather are discussing issues, including the structure of a combined entity and corporate governance. A transaction may create a company valued at over $25 billion and give VimpelCom, Russia’s second biggest mobile phone operator, access to markets in Africa and the Middle East.
The current VimpelCom operation was created in 2009 by a merger of a Russian company with the same name and Telenor’s interests in eastern Europe.
The debt for VimpelCom and its subsidiaries will rise to 2.5 times earnings before interest, taxes, depreciation and amortisation following the transaction. VimpelCom has a market value of about $19 billion, while the value of Weather’s combined holdings is close to $6 billion, consisting of $2.4 billion for Orascom and $3.6 billion for Wind, excluding debt. GTB