The Saudi Telecom Company (STC) announced, on Monday, that it is extending by 90 days its memorandum of understanding (MoU) with Vodafone Group for the possible purchase of the latter’s 55% stake in Vodafone Egypt.
The time will be used to complete the necessary procedures for the deal, according to a statement STC sent to the Saudi Stock Exchange (Tadawul).
“Given the logistical challenges caused by the coronavirus (COVID-19) pandemic, and the need for more time to complete the transaction-related procedures, including due diligence, the two parties [STC and Vodafone Group] have agreed to extend the Vodafone Egypt acquisition MoU for 90 days effective from today,” the Saudi company said.
The two parties will work during this period to move forward with the acquisition procedures as specified in the MoU, the statement added.
STC and Vodafone Group signed a MoU early February to acquire the latter’s controlling stake in Vodafone Egypt for $2.4bn.
However, state-run Telecom Egypt (TE), which owns the remaining 45% stake of Vodafone Egypt, has the pre-emptive right to acquire the rest of the mobile operator. TE has hired EFG Hermes and Citibank to study possible options and investment alternatives for its stake in Vodafone Egypt in light of the STC’s expected deal.
TE’s available options include selling its stake, buying the remaining stake in Vodafone Egypt under the right of pre-emption, or keeping the situation as it is.