Enel Agrees to Sell Wind to Sawiris, Take Indirect Stake in Orascom
By DAVID PRINGLE and JASON SINGER
Staff Reporters of THE WALL STREET JOURNAL
May 27, 2005; Page B3
Italy's Enel SpA Thursday said it will take an indirect stake in Orascom Telecom Holding SAE, which is listed in Cairo and London, as part of a deal to sell the Italian power giant's Wind telecommunications unit to Naguib Sawiris, the billionaire who controls Orascom.
Under the deal, Enel will to take a 26% stake in a new holding company that will own Wind and 50% plus one share of Orascom Telecom. Weather Investments, a group headed by Mr. Sawiris, will own the other 74% stake in the holding company.
Enel will receive �3 billion ($3.8 billion) in cash from Weather and remove �7 billion of Wind's debt from its balance sheet under the deal. Enel said its 26% stake in the holding company is valued at �1.96 billion.
If completed, the deal delivers on a promise by Paolo Scaroni, chief executive of Enel, to unload Wind before he leaves to become chairman of oil giant ENI SpA later this week.
Enel, which wants to concentrate on its power business, said in April that it had entered into exclusive negotiations with Weather for the sale of Wind, but the structure of the announced deal is a surprise because people close to Mr. Sawiris had indicated that Wind and Orascom Telecom would remain entirely separate for the time being.
Under the new arrangement, Wind and Orascom may be able to exchange ideas, products and services through the new holding company and generate some synergies.
Through Orascom and Wind, Mr. Sawiris will have interests in telephone companies in Asia, Africa, the Middle East and Europe.
Orascom has stakes in telephone companies spanning nine countries, with more than 14 million customers. Wind, with a net loss of �363 million on revenue of �4.71 billion last year, has more than 12 million cellphone customers and 2.3 million fixed-line customers in Italy.
Staff Reporters of THE WALL STREET JOURNAL
May 27, 2005; Page B3
Italy's Enel SpA Thursday said it will take an indirect stake in Orascom Telecom Holding SAE, which is listed in Cairo and London, as part of a deal to sell the Italian power giant's Wind telecommunications unit to Naguib Sawiris, the billionaire who controls Orascom.
Under the deal, Enel will to take a 26% stake in a new holding company that will own Wind and 50% plus one share of Orascom Telecom. Weather Investments, a group headed by Mr. Sawiris, will own the other 74% stake in the holding company.
Enel will receive �3 billion ($3.8 billion) in cash from Weather and remove �7 billion of Wind's debt from its balance sheet under the deal. Enel said its 26% stake in the holding company is valued at �1.96 billion.
If completed, the deal delivers on a promise by Paolo Scaroni, chief executive of Enel, to unload Wind before he leaves to become chairman of oil giant ENI SpA later this week.
Enel, which wants to concentrate on its power business, said in April that it had entered into exclusive negotiations with Weather for the sale of Wind, but the structure of the announced deal is a surprise because people close to Mr. Sawiris had indicated that Wind and Orascom Telecom would remain entirely separate for the time being.
Under the new arrangement, Wind and Orascom may be able to exchange ideas, products and services through the new holding company and generate some synergies.
Through Orascom and Wind, Mr. Sawiris will have interests in telephone companies in Asia, Africa, the Middle East and Europe.
Orascom has stakes in telephone companies spanning nine countries, with more than 14 million customers. Wind, with a net loss of �363 million on revenue of �4.71 billion last year, has more than 12 million cellphone customers and 2.3 million fixed-line customers in Italy.
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