UPDATE 1-Algeria seeks bidders for first 3G licences

Thu Aug 1, 2013 11:37am EDT

By Hamid Ould Ahmed

ALGIERS Aug 1 (Reuters) - Algeria on Thursday invited applications to bid for three licences to set up and operate the country's first third generation (3G) mobile phone networks.

Aug. 15 is the deadline for operators to show interest, the Regulation Authority of Post and Telecommunications (ARPT) said in a statement on its website.

The long-delayed tender is intended for "operators operating a mobile telecommunications network in Algeria," it said.

Russia-focused firm Vimpelcom's unit Djezzy is the main player in the north African country's mobile market.

Figures published by ARPT show Djezzy has 17.8 million subscribers, or 47.55 percent of all mobile users, followed by Algeria's state-owned Mobilis with 10.6 million and Nedjma, a unit of Qatar's Ooredoo, with nine million users.

Most subscribers use prepaid services in the nation of 37 million people.

Nedjma and Mobilis have both expressed a willingness to bid for a licence. Djezzy could not be reached for comment. It rarely makes comments to the media since a dispute broke out with the Algerian authorities.

The Bank of Algeria in 2010 imposed a ban on foreign exchange transfers on Djezzy, preventing it from buying equipment abroad. The government also imposed a $1.3 billion fine on Djezzy for violating foreign currency regulations.

"The current situation makes Djezzy unable to bid for a licence unless the ban is lifted. All bidders need to bring equipment to set up the network," said an analyst familiar with the matter, asking not to be named.

Vimpelcom took over Djezzy as part of a $6 billion deal agreed in 2010 to buy assets from Egyptian company Orascom Telecom.

Algeria wants to nationalize Djezzy and has pushed Vimpelcom into talks to sell a 51 percent stake. There has been no word on the talks since May this year when Algerian Finance Minister Karim Djoudi, who handles the issue, said he would not comment until a deal was concluded.

The government had planned to launch the tender for the third generation mobile licences after concluding an agreement with Vimpelcom, but slowness in talks pushed it a few weeks ago to dissociate the two matters.

Nedjma said on Thursday its net profit tripled to $93.9 billion in the first six months of this year from $29.3 billion in the same period in 2012.

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