After several weeks of needless mystery, Russian phone network Vimpelcom may be on the edge of announcing a $6.5 billion offer for frontier markets rival Orascom Telecom.
VIP (quote) board members met yesterday and are widely expected to make an announcement on their plans to merge with Egypt-based ORSTF (quote) as early as today
While a deal would bring VIP well beyond its Russian wheelhouse into North Africa and South Asia — creating the world’s fifth-biggest phone company in the process — question marks surrounding the fate of Orascom’s crown jewel, the Algerian Djezzy network, remain.
The Algerian government has pressed demands for $230 million in back taxes, most recently detaining the Djezzy CEO in its apparent drive to take over the company.
Analysts generally think the deal would be great for ORSTF, making it a global player and relieving it of anxiety over its Algerian operation. However, the benefits for VIP and its shareholders are less clear.