Telecom Egypt S Regulatory News (TEEG)

15 Nov 2007 07:01

Telecom Egypt S.A.E15 November 2007 Telecom Egypt Announces the Signature of Two Contracts with SEACOM and VSNL in Relation to Its TE North Submarine Cable Project - Deal worth US$ 90 Million Cairo, 15th November 2007: Telecom Egypt (TE) (Ticker: ETEL.CA; TEEG.LN)announced today it has signed two agreements with SEACOM Ltd and VSNLapproximately worth US$ 90 million in relation to its TE North Submarine CableProject, which was announced earlier this year. TE being Egypt's only fixed network operates the TE Transit Corridor, whichcomprises the terrestrial infrastructure uniquely linking the Red Sea and theMediterranean, over multiple diverse and redundant proven routes. The TE TransitCorridor developed over nearly 20 years to be the route of choice for allcrossing submarine cable systems in this geography, which multiplies the benefitof the new crossing systems through the ability to achieve interconnection andrestoration. TE North increases the service footprint of the existing TE TransitCorridor, by extending its transit services in the Mediterranean. AdditionallyTE North aims to service the Egyptian National market using this "build strategy" to lower the cost point of the TE group retail internet arm. TE North isexpected to require nearly US$140 million of capex and to be ready for serviceby the first half of 2009. Akil Beshir, Chairman & CEO of TE stated that: "TE North complements ourtradition in serving the submarine cable systems to connect nearly 2 billionpeople in Asia to the Western Hemisphere. We take this tradition very seriouslyand continue to enhance the TE Transit Corridor, both through the unique terrainof Egypt and also through our experts who built this route and witnessed theseveral submarine cable crossings through it. TE North will offer flavours ofbulk capacity and physical transport through various service offerings thatenables TE North customers to maintain their operational and strategicintegrity. The supporting isolated business plan is not the only part of thestory. Other enhanced services to content players, data centres and call centresfurther improve this plan and extend TE service foot print into more managedservices." SEACOM is an infrastructure investment group which will construct a 15,000 kmsubmarine cable system that connects South Africa, Madagascar, Mozambique,Tanzania and Kenya to India and to the new TE cable station in Ras Sidr, Egyptnear Suez. From here, TE will land the SEA Cable System and SEACOM will own asystem within TE North cable system permitting the full SEACOM system to reachFrance seamlessly. SEACOM's collaboration with TE and the TE North systempermits it to complete its structure to connect South Africa and East Africadirectly to Asia and Europe. Brian Herlihy, President of SEACOM, Ltd. statedthat "the experience in the submarine cable industry that TE brings to thissolution and the ability to transit traffic directly to France, makes this thebest solution for SEACOM. This solution permits SEACOM to offer its customerscapacity from a PoP in a major African city to the PoP in Marseilles all on onesystem." TE and SEACOM estimate that their respective systems will be ready forservice by the first half of 2009. VSNL, a leading communications solutions provider and member of the Tata Group,is also engaging with TE North in a system within a system to offer thecompany's global customers tier-one connectivity from Ras Sidr to France. Mohamed Elnawawy, VP of International, Wholesale and Regulatory Affairs at TEstated "TE North is the first system within a system implementation on the verypopular Northern Egypt based Mediterranean crossing route, the industrycontinues to look for innovative submarine cable efficiencies similar to thesuccessful consortium structures. As such, TE North density achieves even morefavourable build economics. The current deals show the different addressablegeographies TE can serve. SEACOM and VSNL engage with TE North to service theSouth and East Africa Markets as well as the Indian Markets respectively. TheSEACOM and VSNL deals enable TE North business case, and are worth approximatelyUS$90M, accounting for approximately 25% of TE North capacity. Those contractsare expected to be the first in a series of contracts that TE expects to enterinto in relation to its TE North Submarine Cable System as well as the TETransit Corridor." - Ends - For further information: Tarek M. Tantawy, CFAVice President & Chief Financial OfficerTel: +2 02 25763030 - +2 02 25778992Fax: +2 02 25789246E-mail: investor.relations@telecomegypt.com.eg Alia A. AlloubaInvestor Relations Assistant ManagerTel: +2 02 25788787Fax: +2 02 25789314E-mail: investor.relations@telecomegypt.com.eg Notes to Editors: Within this statement, we may make forward-looking statements regarding futureevents or the future performance of the Company. By their very nature,forward-looking statements involve inherent risks and uncertainties, bothgeneral and specific, and risks exist that the predictions, forecasts,projections and other forward-looking statements will not be achieved. Youshould be aware that a number of important factors could cause actual results todiffer materially from the plans, objectives, expectations, estimates andintentions expressed in such forward-looking statements. When relying onforward-looking statements, you should carefully consider the political,economic, social and legal environment in which Telecom Egypt operates. Suchforward-looking statements speak only as of the time of this release today.Accordingly, Telecom Egypt does not undertake any obligation to update or reviseany of them, whether as a result of new information, future events or otherwiseother than as required by applicable laws, the Listing Rules or Prospectus Rulesof the United Kingdom Listing Authority, the Egyptian Capital Markets Authorityor the Cairo and Alexandria Stock Exchange. The documents filed from time totime with these authorities may identify important factors that could causeactual results to differ materially from those contained in any forward-lookingstatements. About Telecom Egypt Telecom Egypt (TE), Egypt's incumbent telecommunications operator, started itsoperations in 1854 with the first telegraph line in Egypt. Then it wascorporatized in 1998 to replace the former Arab Republic of Egypt NationalTelecommunication Organization (ARENTO). The Company is the largest provider offixed-line services in the Middle East and Africa with 11.03 million subscribersas at the end of September 2007. TE provides retail telecommunication services including access, local, longdistance and international voice, Internet and data, and other services. Thecompany also provides wholesale services including bandwidth capacity leasing toISPs, and national and international interconnection services. Telecom Egypt'sservices also include the provision of narrowband and broadband internet accessthrough its subsidiary TE Data. TE Data has active operations in Egypt andJordan. TE currently participates in the mobile segment in Egypt by providing mobileinterconnectivity through its current, increased 44.79% holding in VodafoneEgypt, one of the three existing Egyptian mobile operators. TE's shares and GDRs (Ticker: ETEL.CA; TEEG.LN) are traded on the Cairo andAlexandria Stock Exchanges and the London Stock Exchange. About SEACOM SEACOM provides high capacity bandwidth linking businesses, individuals, andcommunities in Southern and East Africa, Europe and South Asia. When it is fullyfunctional in 2009, SEACOM will be a service provider of international fiberoptic bandwidth along the East Coast of Africa linking Southern and East Africa,Europe and South Asia. SEACOM has 1.28TB/s, to enable high definition TV, peerto peer networks, IPTV, and surging Internet demand. Pricing will besignificantly lower than current satellite or fiber pricing. SEACOM will beready to serve Southern and East African markets from 2009, well in time to meetthe bandwidth needs of the Confederations Cup and the 2010 Soccer World Cup inSouth Africa, and the growing requirements of the economies in the countries itserves. SEACOM has been structured to meet the policy objectives of Governmentsand NEPAD. SEACOM will be first to launch services with a planned Ready forService date of June 2009. SEACOM is 76.2% African owned. This information is provided by RNS The company news service from the London Stock Exchange