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Sunday, 11 December 2022

Vodacom closes acquisition of 55% stake in Vodafone Egypt

Vodacom is Vodafone Egypt’s new majority shareholder: Vodafone Plc’s South African subsidiary, Vodacom, has closed the acquisition of its parent company’s 55% stake in Vodafone Egypt, Al Mal reported on Thursday. The company reportedly acquired Vodafone’s 132 mn shares in Vodafone Egypt in a block trade transaction on the EGX on Thursday for EGP 59.7 bn (USD 2.4 bn). Enterprise did not hear back from representatives of the FRA or Vodafone Egypt in time for dispatch.

A long time coming: Vodafone shareholders approved plans to offload the company’s stake in Vodafone Egypt to Vodacom in January, after management greenlit the acquisition in November 2021. Vodafone had been expecting to close before the end of March, but the transaction stretched on as the two sides waited for approvals from Egyptian regulators. Vodafone Plc owns 60.5% of Vodacom, according to public data.

No official word yet from the regulators: There’s still been no word publicly from the Financial Regulatory Authority or the National Telecommunications Regulatory Authority on the sale. Last we heard, the two regulators were still deciding whether to approve the transaction, which was the subject of a national security review. Vodacom Group CEO Shameel Joosub was quoted in November by South African media as saying the company received regulatory approvals to go ahead with the acquisition.

Vodafone Egypt could welcome another new shareholder to the mix before the end of the year: The Qatar Investment Authority (QIA) is among three Arab sovereign funds reported to be in talks with Telecom Egypt over the purchase of a 20% stake in Vodafone Egypt, which sources have said could close before the end of the year. The EGX-listed telecoms giant holds the other 45% stake in Vodafone Egypt and the government owns 80% of TE.

And Vodacom already has big plans for Egypt: The South African telco plans to launch financial services products in Egypt through the Vodapay superapp it’s developing with Chinese tech giant Alibaba Group. Vodapay is modeled on Alibaba’s Alipay ⁠— the world’s largest digital wallet ⁠— and provides access to a suite of financial services including online shopping, loans, and mobile payments.

Advisors: EFG Hermes brokered the transaction, according to Al Mal.

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