April 14, 2009 / 3:25 PM / 11 years ago

Mobinil pulls Egypt shares down as sale hopes fade

CAIRO, April 14 (Reuters) - Shares of Mobinil EMOB.CA dropped for a second straight session on Tuesday as hopes faded that France Telecom FTE.PA would tender for the shares at a premium to their market price.

Shares of Mobinil, Egypt’s largest mobile operator by subscribers, tumbled 6.69 percent to 190 Egyptian pounds

($33.69). They helped weigh down Egypt's market .EGX30, which retreated 1.37 percent to 4,850.62 points, its second session of losses.

Shares of Mobinil have surged 36 percent in the five sessions to Monday’s close.

Egypt’s market regulator says France Telecom should tender to buy all shares in Mobinil as part of a court ruling that it purchase Orascom Telecom’s ORTE.CAORTEq.L stake in a holding company that owns 51 percent of Mobinil. Orascom says the ruling would require the French firm to tender for the shares at 273.26 pounds, about 44 percent above their current price.

But Orascom said on Monday it would consider the ruling void if the French firm did not meet a Wednesday deadline for the transaction.

“People think the issue isn’t going anywhere,” said Karim Hosny, trader at Pharos Securities. “All the hype and the rally in the market was because of the news that a deal would happen at 273.26 pounds and Orascom would get the cash.”

Shares of Orascom dropped 3.18 percent to 30.48 pounds, their second day of declines, on speculation the company would not get the money from the Mobinil deal, Hosny said. They have risen 9.5 percent in the five sessions to Monday on hopes they would benefit from the sale.

Orascom has said it could get $1.7 billion from selling its stake in Mobinil.

($1 = 5.64 Egyptian pounds)

(Writing by Will Rasmussen)

((william.rasmussen@reuters.com; +20 2 2578 3290/1; Reuters Messaging: william.rasmussen.reuters.com@reuters.net)) Keywords: MARKETS EGYPT/CLOSER To view related displays double click on the following codes:

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