MTN has formally ended talks with Weather Investments, the parent of Egypt’s Orascom Telecom, dealing another blow to the SA-based cellphone group CEO Phuthuma Nhleko.
The termination of the talks with Orascom’s parent brings to the three the number of high profile but failed potential deals that Nhleko has tried unsuccessfully to pull off in the past two years.
The first, with India’s Reliance Communications, fell through. Then, the talks with Reliance’s bigger Indian rival Bharti Airtel collapsed. And now MTN has been forced to walk away from Orascom, apparently because of hostility to the deal by the Algerian government. Orascom has a controlling stake in Djezzy, Algeria’s largest mobile operator, and probably the main reason Nhleko wanted Orascom.
In a statement released via the JSE Sens news service on Wednesday evening, MTN says its discussions with Orascom parent company, Weather Investments, regarding the possible acquisition by MTN of control of Orascom and/or certain of its businesses had been terminated.
Last month, Algeria, which has a left-wing government, made it known that it was prepared to buy Djezzy using its preemption rights when it learned Orascom’s parent company was in talks with MTN.
Algeria’s telecoms minister Moussa Benhamadi said the country had the right to be protectionist and reinstate state monopolies to defend its interests, regardless of whether that scared off foreign investors. — Staff reporter, TechCentral
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