KUWAIT CITY (AFP) – UAE telecom giant Etisalat said Thursday it has offered to buy 46 percent of Kuwait’s largest mobile operator Zain and the company’s leading private investor welcomed the move.
“Etisalat has submitted a preliminary conditional offer to buy a 46-percent stake of Zain for an amount of 1.7 dinars (5.97 dollars) per share,” the company said in a statement posted on Abu Dhabi Securities Exchange.
This is the first official confirmation of the size and price of the stake which is estimated to be worth 10.5 billion dollars based on the available outstanding shares of Zain.
“We would like to emphasise that no final agreement has been reached at this point in time as this offer depends on the fulfillment of specific requirements and conditions,” the Etisalat statement said.
The largest private investor in Zain welcomed the offered price saying it is suitable for the two parties.
“We are pleased with offered price because it is good and suitable for both sides,” Nasser al-Khorafi, chairman of the Khorafi Group, was quoted as saying by Kuwait’s Al-Qabas newspaper.
The Khorafi Group has a direct ownership of 12.7 percent of Zain but its share is believed to be more than 20 percent if indirect stakes are taken into account.
The 46 percent is a controlling stake in Zain since 10 percent of its equity are in treasury shares which do not have voting power.
Stocks of Zain, the largest capitalised listed firm on the Kuwait Stock Exchange with 20 billion dollars, were suspended on Thursday pending the availability of details on the sale.
In March, Zain sold its operations in 15 African nations to India’s Bharti Airtel for 10.7 billion dollars, netting a profit of more than three billion dollars from the deal.
Besides Kuwait, Zain operates in Saudi Arabia, Bahrain, Jordan, Iraq, Lebanon, Sudan and Morocco.
The Kuwaiti government holds a 24.6 percent stake in the firm, which currently has more than 30 million clients.
Before striking the deal with Bharti, Zain held unsuccessful negotiations with an Indo-Malaysian consortium to sell 46 percent of the company for about 14 billion dollars.