Global telecom provider Vodafone Plc is in talks to sell the controlling stake in its Egypt unit to Telecom Egypt in a deal that could be worth 3 billion pounds ($4.3 billion), says a media report.
Telecom Egypt, which already owns a 45 per cent in Vodafone Egypt, approached UK-based Vodafone about buying the remaining stake, the Financial Times said citing people familiar with the situation.
Vodafone chief executive officer Vittorio Colao is undertaking cost-cutting measures as the company struggles to offset a declining demand for its services in Europe with investments in emerging markets.
As well as considering the disposal of some of the Vodafone's minority stakes in mobile operators, he is also willing to contemplate the sale of some of the UK group's controlled assets.
The report said that talks about a possible deal began about one month ago, but no decision has been taken yet.
Vodafone declined to comment, while Telecom Egypt said it was not aware of the talks, the daily noted.
According to the publication, Vodafone Egypt's revenue growth has slowed in the past two years because of the economic slowdown.
However, Vodafone Egypt is highly profitable and generated pound 488 million of operating cash flow in 2009-10. The margin at the level of earnings before interest, tax, depreciation and amortisation was 50 per cent in 2009-2010.
