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Wed 27 Feb 2008 10:10 AM

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NTRA sets out auction for fixed-line licence

Bidders must pay $10,000 for a copy of the license and submit an auction guarantee of 10 million Egyptian pounds ($1.82 million), regulator announces

Egypt's state-owned fixed-line monopoly is set to end this summer after the NTRA, Egypt's telecom regulator, announced that it intends to auction a second fixed-line license on June 19.

The regulator, which is inviting national and international consortiums to bid for the second fixed-line licence, said that interested parties will have to pay $10,000 for a copy of the licence specifications and conditions, which will be made available from March 13, 2008 at NTRA's headquarters.

Companies looking to make a bid must also submit an auction guarantee of 10 million Egyptian pounds ($1.82 million). An enquiry session will be held on April 21, the NTRA added.

However, key details about the licence remain unknown, including where the second fixed-line operator will be able to establish a network, and whether the winning bidder will have to construct its own fixed-line infrastructure, or whether it will be able to share the network of incumbent operator, Telecom Egypt. When contacted by CommsMEA, a spokesman at the NTRA said that these details had not yet been finalised.

While the spokesman was also unable to comment on how many bids the NTRA expects to receive for the licence, a number of players including Orascom Telecom, Etisalat Misr, Egyptian Post, and Raya Technology and Communication, an Egyptian communications specialist, are already reported to be interested.

Etisalat Misr's chief executive, Saleh al-Abdouly, told state news agency MENA in 2007 that his company would bid for the licence. His comments were given further weight when the company agreed last month to buy a 27.27% stake in Nile Online (NOL) and a 16.46% stake in the Egyptian Company for Networks (EgyNet), from Egypt Telecom. Industry analysts said the deal indicated Etisalat Misr's desire to strengthen its position in Egypt's ISP sector ahead of making a bid for the second fixed-line.

Naguib Sawiris, Orascom Telecom's chief executive, said recently that his company was looking at various opportunities, including the acquisition of new licences. His comments following the company's sale of its remaining 14.2% shares in Hong Kong-based Hutchison Telecommunications International for HK$ 7.5 billion (US$960 million).

Meanwhile, Raya said late last year that it was studying a potential bid for the second fixed-line licence through an alliance with an international operator. Company chairman Medhat Khalil told Reuters that he was waiting for the announcement of the licence conditions, and denied rumours that his company was planning to partner with UK operator BT to make a bid.

Egyptian National Postal Organisation's chairman, Alaa Fahmy, announced that ENPO would compete for the second fixed-line license in Egypt last September. Fahmy said that the Post Authority, buoyed by its experience in the community postal and banking services, planned to join forces with a partnering consortium.

Egypt's second fixed-line network, which would compete with that of Telecom Egypt, is expected to start operating in early 2009.

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