Government to resolve TE and VFE’s conflict of interest before year’s end?
Government to resolve TE, Vodafone Egypt conflict of interest before year’s end? The Ismail Cabinet is reportedly looking to put to rest the conflict of interest between Telecom Egypt and Vodafone Egypt before the end of 2017, sources close to the matter tell Al Masry Al Youm. The government is already studying several possible routes for the state-owned telco to divest its 45% stake in VFE, they said. One scenario involves turning TE into a holding company and handing the share over to one of its subsidiaries, an option unlikely to assuage concerns of others in the industry. Other proposals on the table include switching ownership over to another government entity or bringing in a third party investor, the sources add. Vodafone Egypt management has reportedly reached out to the ICT Ministry and national telecom regulator to try and resolve the issue, especially now that TE is in openly competing with it in the mobile market.
Al Mal reports a different story, as sources tell the newspaper that TE is not planning to exit VFE since it is a “profitable long-term investment.” Analysts had been predicting that TE will be forced to sell its stake in VFE to cover the costs of its entry into the mobile market. VFE has also yet to sign a domestic roaming agreement with TE, which would allow the state-owned operator to use Vodafone’s network infrastructure to offer its own mobile services.