The offer by UAE telecom operator Etisalat, in partnership with the Egyptian Postal Authority, the National Bank of Egypt, and the Commercial International Bank (CIB), is worth £E16.7 billion ($2.9 billion), almost eight times the minimum offer, Amr Badawi, an official from the telecommunications ministry, told reporters.
"The contract will be signed next month and the network will be launched in February," communications minister Tarek Kamel told reporters after the announcement, adding that Etisalat would control 70 percent of the consortium and the Egyptian partners 30 percent.
Two network operators, Vodaphone and Mobinil, currently operate in Egypt.
The third network will see the number of mobile phone subscribers go from 15 million to 35 million in the next four or five years, according to Badawi.
The consortium headed by Etisalat will gain 20 to 25 percent of the market share, he predicted.
For his part, Prime Minister Ahmed Nazif said that the tight competition between the companies was a "clear message showing international confidence in the Egyptian economy."
Nazif said that the choice was made transparently, with sealed offers opened at the ministry of communication in Egypt's Smart Village, a high-tech city on the outskirts of Cairo.
Revenues from the sale will go to the public treasury, said Nazif, adding that they would "support the state budget and will be invested in development projects."
Mohammed Hassan Omran, chairman of Etisalat, said "the winning partnership is committed to offering high quality service on the highest levels to serve Egyptian clients."
"Etisalat is focused on achieving its expansion goals to become the driving force for change in the region's telecom sector," Omran said in a statement.
The winning bidders will offer GSM and third generation technology, the statement said.
The third mobile network will offer "many benefits to customers ... with improved prices and choices for customers, better coverage in the country and the use of the latest technology available in the world," said Omran adding that the network will provide many job opportunities for Egyptians.
Etisalat was chosen from among nine European, African, Arab, Asian, and local companies that had presented bids.
In May, 11 candidates, including EgyptTelecom, Telecom Italia, Kuwait's MTC, Turkcell of Turkey, South Africa's MTN, and Russia's MTS all presented bids for the mobile license.
The decision in May 2003 to grant a license to a third mobile network prompted the two current operators - Vodafone and Mobinil - to propose a payment of $300 million to EgyptTelecom to stave off the arrival of a competitor until 2007.
But parliament's transport and communications committee opposed the idea, affirming the need to put an end to the existing duopoly.
Rumors of a win by the Etisalat-led consortium sparked a 6 percent rise in shares of CIB on Tuesday, the official news agency MENA reported.
At the same time other Egyptian companies who had participated in the offer saw their shares dip between 1.5 to 4.6 percent.
Etisalat heads a consortium that operates the second mobile telephone network in Saudi Arabia and has shares in several operators in Africa.
In 2005 the UAE company saw a 25 percent increase in net profit to Dh4.3 billion ($1.17 billion).
© 2006 Agence France-Presse
To add a comment,
Please log in:
Don't have an account?
Register now to comment on stories and stay up to date on important events and issues in the Middle East with our newsletter.