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Naguib Sawiris likes to think of himself as the Middle East's answer to Richard Branson. Last year the Egyptian entrepreneur started operating what is so far Iraq's only mobile-phone network. After just six months, his company, Orascom Telecom, already has more than half a million subscribers there, earning it $95 million before taxes and interest. Like Branson, Sawiris is a music lover — he calls himself a "party animal" — and has a taste for risky ventures. To date, six Orascom engineers and technicians have been kidnapped in Iraq and two of its sites have been shot at. "I didn't sleep for a month" after the kidnappings, Sawiris told Time, though he helped secure the hostages' eventual release. But in business terms, it has been worth it. "It's one of our most profitable operations," says Sawiris, 50, sprawled on a leather chair in Orascom Telecom's ornate Paris office. "I take a lot of risks, but calculated risks."

Now Sawiris stands on the edge of one of the biggest risks of his life. Last week, he began exclusive talks with the Italian utility Enel to acquire its mobile-phone network, Wind, in a deal that values the firm at €12.2 billion. Assuming Sawiris pulls it off, the Wind deal will be the largest private-equity takeover in European history. It will also put him in the unusual position of building the first European telecom powerhouse out of Egypt.

Sawiris comes from a wealthy Coptic family; the Copts are a Christian minority in Egypt that make up only about 10% of the population but is well represented in financial, government and intellectual circles. His father, Onsi, made his fortune in Egypt in the 1950s in the construction industry, but then lost it all when President Gamal Abdel Nasser nationalized the business in the early '60s. The family moved to Libya and started afresh, but moved back to Egypt a decade later. There, Sawiris senior proceeded to build his fortune anew.

He has since divided his empire among his three sons: Naguib, the eldest, took telecommunications; the youngest, Nassef, runs the construction business; and the middle brother, Samih, has a tourism and travel company. Naguib seems to have inherited his father's golden touch. Over the past six years, Cairo-based Orascom Telecom Holding has grown into an increasingly profitable company with more than $2 billion in annual revenue and 14.5 million subscribers in Muslim countries, including Algeria, Egypt and Tunisia.

Although Sawiris has always been able to rely on family money, his line to international success has not been entirely straight. Having overextended its mobile network in the late '90s, the firm ran into financial problems in 2001 as the worldwide demand for telecommunications dried up. Sawiris had to sell off assets, including a valuable franchise in Jordan, to pay down debts. In the process, he got support from an unusual business source: Yasser Arafat, the late Palestinian leader. Sawiris says he met Arafat twice, once in 2000 on the eve of the failed Middle East peace summit at Camp David: "I went away from that meeting and told my father: 'This man is not going to sign anything at the summit.'" But Arafat did approve a sizable investment in Orascom. The Palestinians partnered with Orascom in Algeria and Tunisia; when the firm ran into trouble, they exchanged some of its debt for equity. In all, the Palestinians invested about $200 million in Orascom — at one point, the official Palestine Investment Fund owned 9% of the company and had a seat on the board. It has since reduced its stake by two-thirds, but remains a shareholder.

Since getting back on its feet, Orascom has jettisoned its activities in some markets, including Chad and Ivory Coast, and concentrated its efforts on a handful of key nations. Top of the list is Algeria, where it has over 70% of the market. But the firm also has 5 million customers in Pakistan. Last year, the company generated over $1 billion in earnings before interest, dividends and amortization — more than double the total for 2003. Sawiris still sees plenty of opportunity to grow his business in the Middle East, but these days his appetite seems bigger. The Wind deal involves his own money, not Orascom's — in part so as not to destabilize the firm, which is publicly traded on the Cairo and London stock exchanges but is 57% owned by his family.

The proposed buyout also has some investors scratching their heads. Wind, with 12 million subscribers, is Italy's third-largest mobile-phone service, but has never made a profit. While about €7 billion of the total €12.2 billion valuation is debt that's likely to be refinanced as part of the deal, the acquisition is expensive.

Moreover, for a man who has focused on bringing basic phone services to developing countries, it's hard to see the attraction of Italy, a wealthy nation saturated with phones. Orascom's concept "is one of high growth in underpenetrated, low-income markets in the emerging world. Extending that footprint into mature, competitive developed markets changes the investment case in our view," frets István Máté-Tóth, analyst at Credit Suisse First Boston, in a research note.

"It doesn't fit," acknowledges Sawiris — at least not for now. He plans to slot Wind more comfortably into his portfolio by wringing better returns out of the company, which lags far behind its two Italian competitors, TIM and Vodafone, in the amount of revenue it derives from each customer. But Sawiris says he's expecting a continuing consolidation of the mobile-phone industry, and is trying to position himself for the future. For a time, Wind and Orascom would remain entirely separate entities. But the two operations could eventually be put together. "My vision in five or eight years is that my company will have achieved most of its growth and will become more or less a utility, and therefore won't have the same excitement for investors," he says. Combining the companies at that point might make sense in order to gain a critical mass that would enable him to get better terms from equipment suppliers and others. € The Wind deal has yet to be finalized, and could still fall apart. Responding to critics of the deal, Sawiris points to his record of success in unlikely places: "When I went into Algeria and Pakistan, people thought I was crazy. They still think I'm crazy because I'm in Iraq." € Sawiris has a big appetite for fun as well as for risk. He and his glamorous wife, Ghada, are fixtures on Cairo's social scene, and in the 1990s he opened some of the Egyptian capital's coolest night spots, including Piano Piano, a trendy bar frequented by Egyptian movie stars. He says he cut down on such schmoozing after his father's friends worried that it could hurt the family's reputation. But Sawiris boasts: "I throw the best parties in town. It's a passion for me to see people happy." Still, people who know him well say he can be moody, and is a sore loser. "Those who get him on a rare good day love him," says a family friend. "Those unlucky to get him on a bad day hate him." If Sawiris can pull off the Wind deal, he might look forward to having a few more good days.

• Peter Gumbel | Paris
• Naguib Sawiris built an empire providing mobile-phone service in the Middle East. His next target: Italy