Orascom and France Telecom end dispute
France Telecom and Orascom pledge to continue partnership and grow Mobinil.
Orascom Telecom and France Telecom have agreed to end a protracted and bitter dispute over the ownership of Egypt's leading mobile operator, Mobinil.
The two telecom groups signed an agreement on Wednesday that they said would "effectively bring to an end all disputes in relation to their joint investment in Mobinil".
The telcos confirmed that they would "continue their partnership on a renewed basis", implementing a revised shareholder agreement while leaving the existing ownership structure of their shareholders' voting rights unchanged.
The agreement signals the end of a long and costly dispute that had threatened the credibility of both warring factions as well as the performance of Mobinil.
Under the outlined agreement, France Telecom will change its accounting method and Orascom Telecom will consolidate its participation in ECMS - the company that operates Mobinil - through equity.
The agreement will also include settlements for all the disputes between the shareholders, and will make provision for the integration of Orascom-backed LINKdotNET, Egypt's leading ISP, into ECMS.
The agreement also marks a significant achievement for Stephane Richard, who replaced Didier Lombard as CEO of France Telecom in March this year. Earlier in the month, Richard made clear his intention to expand France Telecom's operations in the Middle East and Africa, an ambition that will aided by an improved relationship with Orascom Telecom.
In a sign that the change of leadership at France Telecom had helped thaw the relationship between the two operators, Naguib Sawiris, executive chairman of Orascom Telecom, said that he was "personally grateful" for Richard's commitment to the agreement.
The finalised agreement will be signed in Cairo in the presence of the heads and leaders of the two companies and Egypt's Ministers of Telecommunications.