Orascom Telecom to spend US$500 million in Algeria

LONDON—African mobile operator Orascom Telecom announced it plans to invest US$500 million during the next five years in building its GSM infrastructure in Algeria, a report from the Egyptian news agency, APS, reveals.
Cairo-based Orascom won Algeria’s second GSM license on 11 July with a US$737 million bid. Speaking at a news conference following the signing of the license contract, Orascom Chairman and Chief Executive Naguib Sawiris said his company would invest US$200 million in the next two years and US$500 million over a five-year period.
“We aim to have 10 million subscribers by 2015 and be operational before February 2002,” APS quoted him as saying.
Orascom plans to install a network of up to 500,000 mobile lines in the first year and double it the following year. Orascom will pay for the license in two installments, with the second US$368.5 million payment due at the end of 2003.
Orascom’s GSM license is for 15 years and is automatically renewable for further five-year periods. Algeria plans to grant a third GSM license in December 2003 as part of its efforts to liberalize the telecommunications sector.
Orascom has high hopes for Algeria’s telecoms market, saying it has similar potential growth as Egypt. Orascom is part owner of Egyptian mobile operator MobiNil, the larger of the country’s two operators with more than 1.6 million active subscribers.