Egypt’s Orascom Telecom Shares Rise On Hopes Of Better Buyout Offer

Egypt’s Orascom Telecom (OT) (ORTE) helped lift Cairo’s bourse  the Egyptian Exchange on Wednesday after the company’s management urged shareholders to reject a buyout offer, raising investor hopes the bidder might propose improved terms.

OT’s board said the offer of $0.70 a share from a subsidiary of Russian billionaire Mikhail Fridman’s Altimo was below the stock’s fair value of $0.86, a figure drawn up by an independent financial adviser.

Shares in OT gained 0.4 percent to 4.68 Egyptian pounds ($0.67). The firm also reported its first-quarter earnings on Wednesday – it swung to a net loss, blaming foreign exchange losses and impairment of some assets.

“A third party is telling you the share is undervalued – the stock took an immediate reaction to that and absorbed the bad results,” said Mohamed Radwan, director of international sales at Pharos Securities. “The view now is that maybe Altimo will come back with a better offer.”

Cairo’s index advanced 1 percent, up for a fifth session in the last seven. Foreign investors were net buyers.

Reuters