Lebanon begins mobile privatisation

Auction of the country's two mobile network operators slated for February 2008.

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By  Michele Howe Published  October 10, 2007

Lebanon has begun the process of modernising its mobile services provision with telecom officials yesterday marking early next year for the auction of the country's two mobile network licences.

Officials at Lebanon's Higher Privatisation Council and Telecommunications Regulatory Authority said that the auction for the country's two mobile networks has been scheduled for February 2008, according to a report in local newspaper The Daily Star.

Interested companies will be allowed to buy two-thirds stakes in each of the country's cellular networks, run by MTC Touch (Zain) and Alfa, while the government will retain a third of the shares, according to the report.

The government will then issue an initial public offering (IPO) enabling the public to buy shares in its stake in the company.

Information on the auction will be made public in a ‘couple of weeks', HPC president Ziad Hayek said.

Kamal Shehadi, president of the TRA, said that the auction would be the most transparent and competitive process in Lebanon's history.

"The entire process will be broadcast live and in the presence of the press in order to show that we have nothing to hide," he said.

He added that between seven and eight companies have expressed keen interest in bidding for the 20-year licences.

The TRA said that any consortium must acquire a minimum of 15% of the entire stake of each mobile network, and must include an experienced mobile operator.

Lebanon currently has 1.2 million mobile users who generate more than $750 million in net revenues for the government each year.

The current operators, MTC Touch and Alfa, presently charge the government approximately $4 million each to run the government's two GSM networks.

The government, whose contract with the two operators is due to expire in May and June next year, has previously said it could make up to $6 billion from the licensing of the two cellular networks.

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