Saudi Telecom looking to expand, in talks to buy 55% stake in Voda Egypt

The Saudi Telecom Co. announced it reached a preliminary agreement on Wednesday to buy a 55% stake in the Egyptian holdings of telecommunications giant Vodafone.

The kingdom's largely state-owned communication firm announced that it had offered $2.39 billion in cash for the Egypt unit, as part of its continued efforts to carve out more market share in the Middle East.

The prospective deal confirms STC's eagerness to maintain a leadership position not only in the Kingdom of Saudi Arabia, but also in the wider region, said Telecom's chief executive, Nasser al-Nasser.

The British-based Vodafone is one of the world's largest cellphone operators and the top provider in Egypt, with over 40 million Egyptian subscribers.

Nick Read, CEO of Vodafone, said the transaction would guide the company to strong earnings, delivering shareholder value and reducing overall debt.

Under STC, I believe they will continue to flourish, he said of holdings in Egypt. Read said the offer will help Vodafone streamline its business as it focuses increasingly on Europe and sub-Saharan Africa.