M&A WATCH- STC postpones talks for loan to finance Vodafone takeover: Saudi Telecom Company (STC) has delayed talks to raise debt finance for its acquisition of Vodafone Group's 55% stake in Vodafone Egypt due to the covid-19 outbreak, Bloomberg reports, quoting sources in the know.

This doesn’t mean that the acquisition has been put on ice: The company is continuing to work on the acquisition and may restart negotiations for a USD 2 bn+ loan after the crisis abates, the sources said. STC is also considering other options to finance the purchase, which the Saudi giant agreed on in January before the outbreak went global, one of the people said without giving further details. We noted last month that STC had already begun doing duty diligence on Vodafone Egypt.

A refresher on the M&A: STC signed a non-binding agreement with UK-based Vodafone Group to buy its stake in Vodafone Egypt for USD 2.4 bn in January. Telecom Egypt, which owns the remaining 45%, has a right of first refusal on the transaction and will reportedly decide this month how it plans to proceed. Another complication for STC was presented by the Financial Regulatory Authority, which said after the initial acquisition agreement that the Saudi company may be required to make a mandatory tender offer for 100% of the company if it goes ahead with the Vodafone Group buyout.

Advisers: Barclays is working with STC on the transaction, Goldman Sachs is advising Vodafone and EFG Hermes and Citibank are advising Telecom Egypt.