Africa's largest operator, MTN, would have forked out $7.8 billion for Orascom's Algerian operation, Djezzy.
Officials at the company revealed the possible price this week, as the Algerian government gears up to begin talks about sweeping Djezzy out from under MTN's nose. MTN and Orascom have been in talks over MTN's possible purchase of several of the Egyptian business's African operations.
Of the several countries that MTN hopes to get, Algeria sports the largest opportunity, carrying traffic for around 15 million subscribers. However, the Algerian government has been against the deal from the beginning, despite a plea by SA's deputy minister of trade and industry, Bongi Maria Ntuli, to allow the deal to go ahead.
Algeria's minister of commerce, Hachemi Djaaboub, has maintained the Algerian government has the right to first purchase if Orascom decides to sell, and the Egyptian business has now agreed to talks with Algiers with an aim to selling the business to government.
MTN's offer of $7.8 billion shows it clearly values the asset and, despite the troubles between Algiers and Orascom, MTN may still end up with the Djezzy unit. Analysts have noted it is possible the Algerian government will buy it up only to resell it to MTN.
With all the countries included, MTN is speculated to have offered $9 billion in total.
Djezzy is Orascom's top performer in its stable of telecoms operations, which exploded to a 67% market share in the country since its commercial opening in 2002. The company was the first mobile business to be granted a licence to provide services, followed by Kuwait's Wataniya Telecom.
The other North African countries which are likely being discussed as part of the deal include Tunisia with 4.8 million subscribers and Egypt with 24 million people on its network, making them all attractive targets.
MTN is still quiet on the situation; however, it has not yet reversed its cautionary issued to shareholders in April.
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