(The author is a Reuters Breakingviews columnist. The opinions
expressed are her own)
By Una Galani
DUBAI, Jan 23 (Reuters Breakingviews) - Politics will play a
major part in the sale of Maroc Telecom (IAM.CS). Vivendi
(VIV.PA), the French media and telecom conglomerate, is in
shrinking mode. It hasn’t had any trouble drumming up interest
from far-flung corners of the world for its 53 percent stake in
the listed North African telecoms operator. Qatar Telecom
QTEL.QA, the UAE’s Etisalat ETEL.AD and South Korea’s KT
Corp (030200.KS), have all submitted expressions of interest.
And France Telecom FTE.PA is also keeping an eye on the sale.
Maroc Telecom offers a rare chance to take control of a
leading operator in the region, but it is also a large and
pricey acquisition. Any bidder would have to stump up as much as
6 billion euros ($7.9 billion) after extending the offer to
minority shareholders, assuming the government of Morocco will
want to hold onto its 30 percent. At six times earnings before
interest, taxes, depreciation and amortisation, the operator
trades at a 20 percent premium to its peers in the region.
Although Maroc Telecom has suffered fierce competition in
its home market, which accounts for 80 percent of its revenue,
the operator generates cash, and boasts a 56 percent EBITDA
margin. Pricing pressure is expected to ease next year and
there’s room for growth in broadband and mobile data. Nor is
there any sign yet of a slowdown in spite of rising political
instability in Maroc’s high-growth international markets, which
include Mali and Mauritania.
The Moroccan government will have to approve of any buyer.
Given historical country ties, Rabat would probably prefer a
deal that would see the backbone of its telecoms network end up
with France Telecom. But that would require a near-simultaneous
sale of the French operator’s controlling stake in Morocco’s
number two player, Meditel. Faced with financial challenges of
its own, France Telecom may decide not to embark on such a
That makes the Arab bidders the favourites. Rabat has kept
its distance from the Gulf in the past, but Morocco is now
hoping its fellow monarchies will support its economy, which is
heavily exposed to the euro zone. The purchase of Maroc Telecom
would make Qatar Telecom’s footprint in the Maghreb almost
complete. And for Etisalat, a successful bid would mark a return
to acquisitions after a three-year hiatus.
With so many politically-acceptable bidders, Vivendi
shouldn’t have too much trouble closing a sale.
SIGN UP FOR BREAKINGVIEWS EMAIL ALERTS:
- Etisalat, the United Arab Emirates' incumbent telecom
operator, on Jan. 17 said it had submitted a "preliminary
expression of interest" for Vivendi's 53 percent stake in Maroc
- Qatar Telecom has submitted a non-binding indicative offer
for the Moroccan operator and is being advised by JPMorgan
Chase, according to a person familiar with the situation.
- South Korean telecommunications firm KT Corp has also
submitted a letter of intent to buy at stake in Maroc Telecom, a
spokeswoman for the company said in December.
- A bid for Vivendi’s stake would trigger a mandatory offer
to minority shareholders including the Moroccan government’s
stake of 30 percent.
- There is no official deadline set for offers, but Vivendi
hopes to sign a deal before the end of the first quarter of
2013, one source told Reuters in October.
- France Telecom owns a 40 percent stake in Morocco’s
second-biggest operator Meditel.
- Maroc Telecom has a market capitalisation of $11.3
- Reuters: Etisalat eyes Vivendi's $5.8 bln Maroc Tel stake
- For previous columns by the author, Reuters customers can
click on [GALANI/]
(Editing by Pierre Briançon and David Evans)
Keywords: BREAKINGVIEWS MAROC/
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