Vodafone to pay Telecom Egypt EGP 5.5 bn dividends
Vodafone Egypt will pay Telecom Egypt dividends worth some EGP 5.5 bn in two installments, Telecom Egypt said in a statement (pdf). The first EGP 4.8 bn tranche is planned in March, with the balance due in June 2020. “Telecom Egypt plans to utilize the cash inflow to deleverage closing all the facilities in EGP to reduce the financing expenses enhancing its profitability, in addition to support its cost cutting initiatives, and continue its strategic investment plans to benefit the telecom industry in Egypt,” TO CEO Adel Hamed said. The payment represents 82% of the dividend payments due Telecom Egypt by Vodafone Egypt, which owns 45% of the mobile network operator, Minister of Communication and Information Technology Amr Talaat said in a statement. Telecom Egypt has netted some EGP 8 bn in dividends from Vodafone since it bought the stake.
Vodafone and TE also signed 10-year infrastructure and transmission agreements worth EGP 10.85 bn. Telecom Egypt will cover Vodafone’s current and future domestic transmission requirements for fixed and mobile services and will make fiber backhauling capacity available to Vodafone Egypt’s network. The agreements will boost Telecom Egypt’s domestic wholesale revenue over the long term and will also improve the quality and speed of fixed and mobile internet for Vodafone customers, CEO Alexandre Froment-Curtil said.
Stake sale? Perish the thought. The agreement made no mention of a time horizon for TE to divest its stake in Vodafone Egypt even as the state-owned company operates We, the nation’s fourth mobile network operator. TE has previously said it has no intention to sell its stake in the “medium term.”