Telecom Egypt (TE) and Vodafone Group have inked a modified shareholders’ agreement which includes changes to Vodafone Egypt’s dividend policy.
According to the agreement, Vodafone Egypt will pay a one-time dividend of EGP 10 billion (USD 636 million) to its shareholders during the 2021 calendar year, EGP 2 billion of which was paid in March, said a joint press release.
The parties have also agreed on a minimum dividend payout ratio of 60 percent of free cash flow in the future.
TE owns a 45% stake in Vodafone Egypt, while Vodafone International has the rest 55%. The agreement also gives Vodafone the right to transfer its shareholding in Vodafone Egypt within the broader Vodafone Group.
Ehab Taha, Partner, and Head of Corporate Commercial said: “We are pleased to have advised Telecom Egypt on this amended shareholders agreement. This agreement enhances the rights of Telecom Egypt as a shareholder in Vodafone Egypt for Telecommunications and sets the way forward for a true partnership between Telecom Egypt and Vodafone Group for future years to come.”
"The new agreement will lead to further stability and enhancement in the mobile telecommunication market in Egypt.” Ehab Taha added.
Egypt’s Minister of Communications and Information Technology Amr Talaat witnessed the signing between the two sides.
Back in December, Vodafone ended its discussions with Saudi Telecom Co for the sale of its stake. At the start of 2020, Vodafone had announced a deal to sell the majority interest in its Egypt business to Saudi Telecom for USD2.39 billion, giving Vodafone Egypt an enterprise value of USD4.35 billion.