CAIRO, Dec 24 - Egypt's Orascom Telecom (OT) (ORTE.CA)(ORTEq.L) said on Thursday it has obtained a month-long waiver from major lenders that will enable it to go ahead with a $800 million capital increase.
Pressed as to what the waiver - to run until Jan. 26 - would entail, officials from the international phone operator declined to comment.
Chief Executive Officer Khaled Bichara told Reuters in an interview the waiver would not affect the firm's repayment schedule for its $2.5 billion of debt.
The company, which runs mobile phone operations from North Africa to North Korea, said it needed the waiver because of issues caused by a dispute with Algerian tax authorities.
Orascom, whose shares trade up 0.7 percent, said it was seeking a longer-term solution from its majority senior secured lenders to address the Algerian tax claim.
It's a systematic thing. Our plan is the same, we're going to do a capital increase, Khaled Bichara told Reuters. Once the capital increase is done, you will not need the waiver anymore.
The company said in December it was seeking shareholder approval for an $800 million rights issue, and would use the money to cover any cash shortfall as it tries to resolve its tax dispute with Algeria.
Orascom said its parent company Weather Investments had committed to 51 percent of the capital increase and would cover any shortfall.
Weather Investments is the ownership vehicle of billionaire businessman Naguib Sawiris and controls 50.6 percent of Orascom, according to Reuters data.
Orascom said in November that Algeria's tax authority had notified it that it owed $596.6 million in outstanding taxes and penalties because it did not keep proper accounts in 2005-2007. Orascom has said it would contest it.
By obtaining the waiver, the company may have succeeded in preventing immediate financial complications, according to a senior Cairo-based legal consultant familiar with the company but not involved in this case.
From the statement it seems to be a waiver of certain terms and conditions of the lending documents, the consultant said, declining to be named due to the sensitivity of the issue.
The firm's Algerian unit operates a mobile network under the brand name Djezzy which had revenues of $1.8 billion in 2007.
(Reporting by Alexander Dziadosz and Patrick Werr)