September 23, 2018 / 11:31 AM / in a month

UPDATE 1-Orascom's Koryolink JV granted right to operate in North Korea

(Adds context, shares)

CAIRO, Sept 23 (Reuters) - Egypt’s Orascom Investment Holdings said it has been granted an exemption from the United Nations to operate its Koryolink venture in North Korea, sending shares up to the daily trading limit.

Last year, the U.N. Security Council agreed to tighten sanctions on North Korea, banning its textile exports and capping fuel supplies, and making it illegal for foreign companies to form commercial joint ventures with North Korean entities.

Orascom sought an official exemption to allow it to continue to operate Koryolink, its joint venture with North Korea’s Post and Telecommunication Company, the company said in a statement.

The group said it received notice from the Egyptian embassy in New York on Thursday that the exemption was granted but did not provide further details.

The company’s statements sent shares in both Orascom Investment Holdings and its sister company Orascom Construction up nearly 10 percent each.

The stock exchange had suspended the company’s shares earlier on Sunday until it responded to an inquiry about the status of its operations in North Korea.

Orascom had said it officially “lost control” of its 75 percent stake in Koryolink in 2015. Despite the mobile network’s rapid rise, the Egyptian firm has struggled for years to repatriate its cash from Pyongyang, filings reviewed by Reuters show.

Source text for Eikon: Further company coverage: (Reporting by Nadine Awadalla, editing by Louise Heavens)

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