Egypt-based Orascom Telecom has forked out $1.3bn (£750m) to acquire a 19.3 per cent stake in Hutchison Telecommunications International as the pair forge closer ties between their mobile businesses.

Not only will the deal give the pair greater buying clout when procuring telecoms gear, it will also help the firms expand into emerging markets in Asia. In particular, Orascom is keen to target India, Indonesia and Vietnam.

By joining forces, the operators believe they can save money and work together to "expand and develop [their] joint footprint in emerging mobile markets at a rapid pace".

Said Naguib Sawiris, chairman and chief exec of Orascom in a statement: "We have often expressed our keen interest to enter some of the largest and highest growth mobile markets in the world like India, Indonesia and Vietnam. The tie up with Hutchison Telecom presents Orascom Telecom with exposure to these markets.

"Combining the equipment procurement of Orascom Telecom and Hutchison Telecom will increase our leverage with suppliers, reducing the costs of network expansion in all our markets," he said.

Orascom also has the chance to acquire a further 3.7 per cent of the business over the next 12 months in a move that could still closer ties between the operators. ®

Related stories

• A phone call from Islamabad (20 November 2006)
• Ericsson to babysit 3's UK phone network (6 December 2005)
• 3 UK lets subscribers be video stars (18 October 2005)
• Hutch buys three Indian cellcos (27 September 2005)
• Hutchison hit by 3G costs (4 April 2005)