Telecom Egypt board appoints new CEO, chairman

Reuters , Thursday 28 May 2015

Telecom Egypt
Egypt telecom (photo: Al-Ahram)

The board of state-owned landline monopoly Telecom Egypt on Wednesday appointed a new chairman and chief executive officer, hours after the prime minister had named new government representatives to the board.

The firm, in which the Cairo government owns an 80 percent stake, is facing challenges into the lucrative mobile sector.

A company source told Reuters the newly appointed board chose Osama Yasin as the new chief executive officer and Mohamed Salem, a former telecommunications minister, as chairman.

State news agency MENA confirmed the names.

The reason for the removal of Mohamed Elnawawy, who became CEO about three years ago, was not immediately clear.

But it raised questions about the future of a unified license that would allow Telecom Egypt to enter the mobile sector against Vodafone Egypt, Etisalat and Mobinil.

Elnawawy told Reuters earlier this year that the company was eager to acquire the new licence. "We know mobile is the only way forward," he said in March.

Yet the shake-up has stirred speculation about whether the new management will change course or pursue the unified licence, said Allen Sandeep, head of research at NAEEM Brokerage.

"The current management still seems interested in going forward with the mobile license. With the new management in place we'll have to wait and watch whether this would remain intact," he told Reuters.

Telecom Egypt, which has a 45 percent stake in Vodafone Egypt, agreed last year to pay 2.5 billion Egyptian pounds ($327.65 million) for the unified licence.

But while the government approved the licence last year, its activation has been repeatedly delayed by reported discord among the four companies and within the government over its details.

Earlier on Wednesday, Telecom Egypt said it was considering buying treasury stocks after the company's share price plunged below nominal value.

Shares rose by more than four percent on Wednesday before the bourse halted their trading, awaiting the new board's formation.

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