Naguib Sawiris, the billionaire scion of Egypt’s most prominent business family, dove into the embers of post-invasion Iraq with a $5-million (U.S.) bid to offer cellphone service and rose from the ashes four years later to sell his network for $1.2-billion.
Mr. Sawiris has a gift for extracting profits from the world’s most volatile telecom markets. His wireless company is the largest taxpayer in unstable Pakistan. He partnered with the dictatorship of North Korea to become the first cellphone provider in that country. And he operates in impoverished Bangladesh, where the monthly bill is around $2.50.
“We go where people don’t dare to go,” the executive chairman of Orascom Telecom Holding SAE and Weather Investments SpA told The Globe and Mail in an exclusive interview. “We’re crazy, adventurous.”
Which is why he now finds himself in Canada – a country with an investment climate he says is worse than the emerging markets in which he usually operates.
The outspoken industrialist was in Toronto to pay a visit to the offices of upstart wireless provider Wind Mobile, which he backs financially. His involvement with Wind has already ignited controversy by challenging Canada’s restrictions on foreign ownership in the telecom sector. In a decision late last year, Industry Minister Tony Clement overturned a ruling by the federal telecommunications regulator that barred Wind from the Canadian market because of its foreign funding.
The landmark judgment allowed Wind to start offering cellphone service in Canada. If Mr. Sawiris’s plans work out as he hopes, Wind will become a fourth pillar in the national wireless market, challenging the incumbents BCE Inc., Telus Corp. and Rogers Communications Inc. As government debates the ownership restrictions, Canada’s telecom sector, which until Wind’s appearance had largely been closed to international investors, now seems ripe for an injection of more foreign capital.
In the eyes of Wind’s critics, the firm is just another pawn in Mr. Sawiris’s global chess game. He has made no secret of his belief that telecommunications around the globe will inevitably be dominated by just a handful of giant firms. With Mr. Sawiris already in merger talks with Russian carrier VimpelCom Ltd. to create a sprawling telecom titan worth about $25-billion, his vision of an age of huge global providers seems near indeed.
Mr. Sawiris’s vast telecom empire already serves 120 million subscribers, or about five times as many wireless customers as the combined total of Bell, Telus and Rogers. His networks span the Middle East, Southern Europe, South Asia and parts of Africa, including some of the most impoverished parts of the world, where cellphone subscribers generate only a few dollars a month.
But in the eyes of the global deal maker, Canada is the true telecom backwater. Mr. Sawiris said the Big Three Canadian telecom players are “a joke,” and that he would never invest in them because they are “too big, too slow.”
“I have been offered by two of them to buy me out at a very significant profit,” Mr. Sawiris said. “But that means I’m a broker, not an industrialist. It’s against my saga, against my history. I’m not the kind of guy who goes out for the money. It’s about success. And this, I would consider it as a bribe.”
Liza Mendonca, Wind Mobile store manager, speaks with her employees at her store on Queen Street in Toronto— For The Globe and Mail
Mr. Sawiris accused the domestic players of playing “unfairly” by denying Wind the roaming and wireless infrastructure-sharing agreements that are mandated by the Canadian Radio-television and Telecommunications Commission. (Executives at the entrenched telecom players say they respond to such requests in a timely manner.) He also compared the regulator to a referee “looking and approving” as a player gets hit below the belt, since pursuing regulatory action against the incumbents could take years.
