Vodafone still studies Egypt 4G licence draft, funding options later on

Vodafone Egypt is currently studying 4G licence draft before deciding whether to purchase the licence or not, said its external and legal director, Khaled Hegazy.

Hegazy added to Amwal Al Ghad that it would be too early to review any financing options to purchase the 4G licence saying it would be later after giving approval. Yet, Vodafone Egypt is probably to self-finance the purchase without resorting to borrowing or taking credit facilities according to the availability of financial liquidity, he said.

The last time Vodafone Egypt secured a loan was two years ago when it signed a credit facility contract worth 4 billion Egyptian pounds with seven Egyptian banks. The seven banks were Banque Misr, the Commercial International Bank (CIB), AlexBank, HSBC, Emirates NBD Bank, the National Bank of Egypt, Qatar National Bank (QNB), and Barclays.

Hegazy clarified that Vodafone Egypt in the current stage gives greater attention to provide dollar liquidity that pays half of the licence value.

In later stages, the company shall decide whether to take loans from local banks or ask Vodafone Group to finance the purchase.

4G is the fourth generation of mobile telecommunication technology and offers dramatically higher data transmission speeds than its predecessor, 3G, which is currently in use in Egypt.

Egyptian telecoms regulator, NTRA asked both Orange and Vodafone to pay 3.54 billion pounds for a 4G licence, half of which must be paid in US dollars. The two mobile operators were also asked to pay 100 million pounds for a licence to offer landline service and 1.8 billion pounds for the right to offer international calls.

Telecom Egypt is supposed to pay 7 billion pounds for the licence while other mobile operators will pay a total of 12 billion pounds to be able to operate the 4G services distributed as follows: 3.540 billion pounds will be paid by Vodafone, the same amount for Orange and 5 billion by Etisalat Egypt.