RIYADH, (Reuters) – Atheeb Telecom, Saudi Arabia’s first private fixed-line phone operator, said on Sunday its top executive has resigned after it accumulated losses close to 40 percent of its capital one year after starting business.

Ahmad Abbas Sindi was replaced by Raed Kayyal, Atheeb said in a statement posted on the bourse’s website.

The company, which focuses mainly on broadband, started commercial operations in June, 2009.

It said last month its net losses stood at 379 million riyals between February, 2009 and March, 31, 2010 with sales of only 35.4 million riyals, which is below half the cost of sales themselves.

This has raised fears among investors that Atheeb would soon need to replenish its capital to keep the business running and competing with cash-laden rivals such as state-controlled Saudi Telecom and Mobily.

Bahrain Telecom holds a 15 percent stake in Atheeb Telecom.

Saudi Telecom and Mobily dominate the broadband landscape, which offers the best growth potential in the Arab world’s largest economy.

Some analysts say Atheeb has put less focus on fixed-line voice services because it was bound to face a price war by Saudi Telecom.

Atheeb’s shares lost 15 percent since the firm started commercial operations.