After years of negotiation and conflict, Algeria tightens its grip on "Djezzy"

After years of negotiation and conflict, Algeria tightens its grip on “Djezzy”

Algeria considers Djezzy Company one of the most important tributaries of the future economic strategy. The company was founded in 2001, when a group of "Orascom Telecom" Owned by Egyptian businessman, Naguib Sawiris, for the second mobile phone license in Algeria.

According to the growth index, the company ended the second quarter of 2022 with transactions of 22.7 billion dinars, an increase of 4.2 percent compared to the same period in 2021..

It closed the first half of 2022 with an income of more than 45.5 billion dinars, with a growth of about 6 percent compared to 2021.

Stations in front of the courts

And before the withdrawal "Fion" Algeria received several requests from foreign dealers, but decided to move forward in the direction of "Pre-emption" Legal, which gave her the full right to acquire all the shares of the company.

In this way, the Algerian government has become the owner of two companies for mobile phone dealers, which raises the problem of competition between the two national companies, and how to manage them and benefit from them in the future..

There are 3 telecommunications companies in Algeria, namely: "requite" And the"mobiles" state-owned, and"ooredoo" A subsidiary of the Kuwait National Telecommunications Company Group.

It is considered "requite" The second company in Algeria in terms of the number of subscribers, covering 95 percent of the entire Algerian territory.

The Algerian government has been through arduous negotiations and legal disputes in order to obtain "requite". The dispute reached the corridors of international courts and the International Center for Settlement of Investment Disputes of the World Bank.

And in 2017, Sawiris lost the arbitration procedure he had filed against the Algerian state, when he demanded $5 billion in damages..

Followed "requite" Before the Algerian court, in the case of tax evasion and illegal transfer of funds.

The Algerian tax authorities imposed on "requite" Tax in the amount of 950 million dollars, representing "tax corrections" Between 2004 and 2009, as well as demanded to pay 1.3 billion dollars for not respecting the Algerian law on foreign currencies.

In the opinion of the economic expert, Hadef, Algeria may turn "Towards opening the capital of Djezzy Company to Algerian investors in the future, to support the strategy of digitizing the Algerian national economy".

This deal raises many questions about the company’s future "requite" And how the state will deal with the new situation, in which the government has become in control of operators in the telecommunications service.

In this regard, the expert in the field of communication and information and communication technologies, Yunus Gharrar, said that the solution may lie in "The merger of the two companies Jazzy and Mobilis, to create a stronger company from a technical and financial point of view".

But he pointed out that this solution "He will face another legal problem related to the monopoly of the market by one company".

Yunus told the site "Sky News Arabia": "The merger of the two companies is technically possible, but the law prevents one company from monopolizing more than 60 percent of the telecommunications market".

Experts are unanimously agreed that Algeria needs "A strong company to support major economic, political and strategic goals, in light of the prominent trend towards digitizing many sectors, after years of digital delays that Algeria has been suffering from.".

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“Today, we completed the sale of our stake in Djezzy to our Algerian partner, which represents an important step in our strategy to rationalize the group’s expenses,” said Kan Terzioglu, CEO of VEON Group.“.

The deal took place within the framework of the “right of pre-emption”, which grants Algeria access to shares of foreign companies that deal in the Algerian market.

In this way, the Algerian state acquired the company by one hundred percent, after it had owned 51 percent since 2015, where the National Investment Fund of the Algerian state obtained 51 percent of the company’s capital after 3 years of negotiations and more than 4 years of activity, according to to the terms of the agreement, while the VEON Group has since retained responsibility for the management of the company.

digital security

The Algerian economic expert, Abdel Rahman Hadef, believes that Algeria’s keenness to acquire the “Jazi” company comes within the framework of preserving sovereignty and digital security..

He explained in statements to “Sky News Arabia”: “In addition to the economic goals, Algeria views Djezzy as an important and sensitive operator, so it can be said that the deal falls under the digital security strategy.“.

The economist believes that this capacity “will oblige the government to review the commercial and management aspect of the company, despite the positive growth indicators that Jazzy achieved during the second quarter of 2022.”.

Algeria considers Djezzy Company one of the most important tributaries of the future economic strategy. The company was established in 2001, when the Orascom Telecom Group, owned by Egyptian businessman, Naguib Sawiris, won the second mobile phone license in Algeria..

According to the growth index, the company ended the second quarter of 2022 with transactions of 22.7 billion dinars, an increase of 4.2 percent compared to the same period in 2021..

It closed the first half of 2022 with an income of more than 45.5 billion dinars, with a growth of about 6 percent compared to 2021.

Stations in front of the courts

Before the withdrawal of “Vion”, Algeria received several requests from foreign dealers, but decided to move forward towards the legal “right of pre-emption”, which gave it the full right to obtain all the company’s shares..

In this way, the Algerian government has become the owner of two companies for mobile phone dealers, which raises the problem of competition between the two national companies, and how to manage them and benefit from them in the future..

There are 3 telecommunications companies in Algeria, namely “Djezzy” and “Mobilis”, which are affiliated with the state, and “Ooredoo”, which is affiliated with the National Telecommunications Company of Kuwait..

Djezzy is considered the second company in Algeria in terms of the number of subscribers, as it covers 95 percent of the entire Algerian territory.

The Algerian government went through arduous negotiations and legal battles in order to obtain Djezzy. The dispute reached the corridors of international courts and the International Center for Settlement of Investment Disputes of the World Bank.

And in 2017, Sawiris lost the arbitration procedure he had filed against the Algerian state, when he demanded $5 billion in damages..

“Jazi” was followed up before the Algerian court, in the case of tax evasion and illegal transfer of funds.

The Algerian tax authorities imposed a tax on Djezzy in the amount of 950 million dollars, representing “tax corrections” between 2004 and 2009, as well as requiring it to pay 1.3 billion dollars for not respecting the Algerian law relating to foreign currencies..

The economic expert, Hadef, believes that Algeria may move “towards opening the capital of the Djezzy company to Algerian investors in the future, to support the strategy of digitizing the Algerian national economy.”

This deal raises many questions about the future of the “Jazi” company and how the state will deal with the new situation, in which the government has become in control of operators in the telecommunications service..

In this regard, Younes Gharrar, an expert in the field of communication and information and communication technologies, said that the solution may lie in “merging the two companies, Djezzy and Mobilis, to create a stronger company from a technical and financial point of view.”.

But he pointed out that this solution “will face another legal problem related to the monopoly of the market by one company.”

Younis told Sky News Arabia: “The merging of the two companies is technically possible, but the law prevents one company from monopolizing more than 60 percent of the telecommunications market.“.

Experts unanimously agree that Algeria needs “a strong company to support the major economic, political and strategic goals, in light of the prominent trend towards digitizing many sectors, after years of digital delays that Algeria has been suffering from.”.


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