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Tue 18 Jan 2011 04:51 PM

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Orascom's Sawiris says Algeria tax dispute unlikely to resolve

Telco fighting claim for $800m in back taxes says arbitration likely to move feud on

Orascom's Sawiris says Algeria tax dispute unlikely to resolve
ORASCOM BOSS: Naguib Sawiris is the chairman of Orascom Telecom Holding (Bloomberg Images)

The chairman of Orascom Telecom Holding, the largest mobile-phone operator in the Middle East by users, has said the company is unlikely to resolve its feud with Algeria over taxes.

“We have had no response from the Algerian government,” Naguib Sawiris said on the sidelines of a conference in the Egyptian Red Sea resort of Sharm El Sheikh. “I’m not optimistic.”

Cairo-based Orascom is locked in a dispute with the government of the North African state, after Algeria hit its subsidiary Djezzy with a claim for more than $800m in unpaid back taxes.

The Algerian government also banned the telco from transferring money abroad and blocked a bid for Djezzy by African operator MTN.

The state has expressed an interest in Djezzy, which it has value at around $7.8bn.

Orascom, which is in merger talks with Russia’s Vimplecom over a planned $6.6bn sale of assets, has said the demand for back taxes is unjustified.

“We have taken all the steps to prepare for arbitration,” Egyptian billionaire Sawiris said.

Commenting on the Vimplecom deal, Sawiris said talks had been positive.

“This transaction is good for shareholders... it changes the company from just risk, brings growth from emerging markets,” he said.

 

 

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