QIA, TE back at the negotiating table over Vodafone stake sale: Qatar’s sovereign wealth fund, the Qatar Investment Authority (QIA), has resumed talks to purchase a stake in Vodafone Egypt from minority shareholder Telecom Egypt (TE), a government source told Enterprise.

The details are still up in the air: The two sides are yet to reach an agreement over the value or size of the stake. The EGX-listed telecom company holds a 45% stake in Vodafone Egypt. The government owns 70% of TE.

Talks have been stalled for months now: We’ve heard little on the progress of negotiations between TE and QIA since February, when talks reportedly hit a wall over how much of the company should be on the table. QIA has been eyeing Vodafone Egypt since at least last September, when a source told us it was one of three GCC sovereign funds looking to snap up TE’s stake.

What’s the hold up? QIA had reservations about the investment climate in Egypt, in light of current economic challenges and the weaker EGP. Representatives of the sovereign fund had held talks with the Madbouly government and the central bank to ensure the climate is fit for investment and that the state is working to improve conditions, our source tells us. The government’s Supreme Investment Council recently issued 22 decisions aimed at putting in place a more pro-business regulatory framework and attracting more foreign investment.

More acquisitions to come? The Qatari fund also expressed interest in some of the 32 state-owned companies that are part of the government’s privatization plan, namely ports and firms in the oil sector, our source says. Agreements are expected to be announced before August, they added.

Potential candidates include: QIA’s Maha Capital earlier this year reportedly submitted an offer to take majority stakes in Damietta and Port Said container terminal operators — Port Said Containers & Cargo Holding Company and Damietta Container & Cargo Handling Company.

Tick, tock: The government aims to raise USD 2 bn via asset sales by the end of June. It has so far raised some USD 153 mn by selling off Pachinand a 10% stake in Telecom Egypt.

REMEMBER-Qatar last year pledged to invest as much as USD 5 bn in Egyptian companies as part of wider Gulf efforts to shore up our economy and provide us with vital FX. The country’s sovereign wealth fund last year deposited USD 4 bn at the Central Bank of Egypt while it held negotiations to acquire stakes in major companies. The country’s finance ministry said recently that it remains committed to investing in Egypt but ruled out providing further deposits or grants.

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