Monday, 10 January 2011

FT Tilt - The bell tolls for Orascom in Algeria (Registration required)

There was a time when the nationalisation of foreign assets in the Middle East involved the uttering of secret codewords in presidential speeches, but that time is long past. These days, it's a pretty straightforward process, as the Algerian government has shown in is nationalisation of Djezzy, the country's largest mobile operator.

The nationalisation took another step forward on Monday as the government announced the appointment of white-shoe New York law firm Shearman & Sterling to advise it on the process, saying it will come up with a valuation of Djezzy within 100 days. What exactly Djezzy's owners, Egypt's Orascom Telecom, can do if they disagree with the valuation is anyone's guess.

Shearman have yet to discuss the new brief, but it's fair to assume that Emmanuel Gaillard, head of the firm's international arbitration practice, will take a lead in the process. Gaillard has previously represented the Algerian state oil firm Sonatrach - itself made up of nationalised foreign assets - in international disputes, including a claim against two Spanish oil firms that saw Sonatrach awarded $580 million worth of assets and successfully dismiss a $3.6bn counterclaim. Shearman have been working with Sonatrach and the Algerian government since the 1960s.

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