OT Not To Resume Arbitration Procedures If Vimplecom Reaches Settlement

Orascom Telecom Holding (OTH) (ORTE.CA) announced that it will go on completing the necessary procedures to go for the international arbitration against People’s Democratic Republic of Algeria in respect of the unlawful actions taken since 2008 by the Algerian government against Orascom Telecom Algerie (OTA) – Djezzy.

Russia-focused Vimplecom, which acquired Djezzy in 2011 as a part of a $ 6 billion deal to buy assets of Egyptian firm OTH, had resorted to hold talks with the Algerian government seeking to drop the $1.25 billion fine.

Khalid Al Leithy, Deputy Chief Finance Officer of Orascom Telecom – OT, said the company will continue completing the arbitration procedures so as to reach a solution with the Algerian government.

“If Vimpelcom reaches a settlement with the Algerian government, Orascom will not go for the International arbitration.” Al Leithy added

Al Leithy said talks between Vimplecom and the Algerian government on acquiring a controlling stake in Djezzy are continuing, but he noted that: “Orascom will not accept to give up the group’s right to manage its Algerian unit.”

Al Leithy also mentioned that both Orascom and Vimplecom seek to end all the pending issues with the Algerian government without giving up their legal and financial rights to manage Djezzy.

Algerian Telecommunications Minister Moussa Benhamadi denied speculation that the talks between the Algerian government and Vimplecom on acquiring a controlling stake in Djezzy had stalled. He said the talks are continuing despite the outstanding disputes between the two parities over the $1.25 billion fine.

Djezzy has been the subject of a long-running dispute with the Algerian government, during which the firm has been hit by back-tax demands, threatened with nationalization, and put under criminal investigation.