Egyptian group Orascom Telecom Holding’s management has recommended shareholders reject an offer by a subsidiary of Russian billionaire Mikhail Fridman’s Altimo to buy the company for $0.70 a share.
A Cyprus-based subsidiary of Altimo made the offer in late March. Orascom has mobile businesses in Canada, Algeria and other emerging markets such as Bangladesh.
A statement by Orascom said that an independent financial adviser had put a fair value on Orascom’s shares of $0.86 per share.
“Hence we see that the offer price is below the fair value of the share by 18.7 percent,” the statement said.
Cairo-based Orascom Telecom (ORTE.CA), a heavyweight on the Egyptian Stock Exchange, is controlled by Russia’s VimpelCom, which together with subsidiaries owns 51.92 percent. Altimo owns 47.85 percent of Vimpelcom.
The offer comes as uncertainty over Orascom’s most lucrative asset, Algerian unit Djezzy which the Algerian government plans to nationalize, appears closer to being resolved.