Orascom buysTunisian GSM licence

Orascom Telecom has signed a 15-year licence deal to operate Tunisia's second GSM network, bringing an end to a lengthy bidding process.

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By  Philip Fenton Published  May 16, 2002

Egyptian company Orascom Telecom Holding (OT) has confirmed it has signed a 15-year agreement to operate a GSM network in Tunisia, bringing to an end a lengthy bidding process.

Early indications had suggested that the licence would go to Kuwait’s National Mobile Telecommunications Company, but it is thought that OT’s promise to pay the full amount by the end of 2002 may have clinched the deal.

OT won the tender in March with an offer of US$454 million, but had repeatedly asked for more time in which to come up with the money to pay the first instalment.

The company has confirmed that it has finally inked the deal and paid the first of two equal instalments. "The first licence instalment of $227 million was deposited in Citibank Tunisia to be transferred to the public treasury," the firm said in a statement sent to Reuters.

The 15-year license has favourable tax conditions and grants OT the right to operate its own international gateway, whilst at the same time providing favourable interconnect conditions. It also provides OT with a four-year exclusivity period in offering GSM services along with Tunisie Telecom.

The original bidding process was called off in July of last year after the government complained that the amounts being offered were too low, but the process was resurrected in October.

Tunisia’s population of 10 million people has so far been served by a single GSM network, run since 1996 by state owned Tunisie Telecom. With a limited capacity of 400,000 subscribers, more than 300,000 people are currently registered on the waiting list for GSM services.

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