Monday, Oct 11, 2010
DUBAI (Zawya Dow Jones)--Egypt's Orascom Telecom Holding (ORTE.CI), or OT, said that its Djezzy unit hasn't received any official notification from Algeria's central bank concerning a $193 million fine for alleged foreign exchange violations.
"Orascom Telecom Algeria did not receive any official notification thus far regarding the mentioned fine and any such fine is subject to investigation and a court process which will determine whether a fine is applicable or not," OT said in a statement to the Egyptian bourse late Sunday.
Last month, Algerian authorities slapped Djezzy with a $230 million tax bill for the 2008, 2009 financial years. Orascom Telecom countered that its accounts were fully audited and approved by both Djezzy's international auditors, KPMG, as well as its local statutory auditors. The telecom company has vowed to take the necessary legal steps to challenge the tax verdict.
The same Algerian tax authority hit Djezzy with a $600 million tax claim in November for fiscal years 2004 to 2007, even though Orascom's operation was tax-exempt until mid-2007.
Djezzy, 90% owned by Orascom Telecom, has the largest share of the Algerian market and is OT's single biggest revenue source.
Last week, Russian mobile operator VimpelCom (VIP) agreed to combine with Orascom's highly indebted telecom assets in a $6.5 billion stock-and-cash deal, transforming two regional emerging-markets companies into a giant with global scale.
Orascom Telecom's Algerian unit has proved a sticking point for any possible asset sale deal. Back in April, Algeria's government effectively blocked a deal that would have involved the sale of Djezzy to MTN Group Ltd. (MTN.JO), Africa's largest mobile operator.
-By Shereen El Gazzar, Dow Jones Newswires; +971 044461684; Shereen.elgazzar@dowjones.com
Copyright (c) 2010 Dow Jones & Co.
(END) Dow Jones Newswires
11-10-10 0707GMT
