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EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

Omantel to buy 12.1% in Zain for RO 520m

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Omantel will acquire a 12.1 per cent stake in Zain for RO 520 million ($1.35 billion), making it the second-largest shareholder in the Kuwait operator.


A share purchase agreement to acquire 521.97 million shares of Zain was signed by Omantel with Al Khair National for Stocks & Real Estate Company, Kuwaiti British Readymix Company, and Gulf National Holding Company, Omantel said in statement on its website.


The offer price per share is 781 Kuwaiti fils, 30 per cent higher than the price paid by the telco when it acquired its initial 9.8 per cent stake in Zain in August, a transaction viewed as expensive at the time.


The Board of Directors of Zain is expected to be reconstituted after the transaction is completed.


The purchase — which is expected to go through next month — will take Omantel’s overall holding in Zain to 21.9 per cent, bolstering its attempts to increase its footprint across the region.


The total transaction value for the 21.9 per cent stake Omantel is RO 845 million.


“Omantel will finance this transaction with a combination of long-term and bridge loan facilities. The bridge loan facility will subsequently be taken out through long-term capital markets instruments,” said the statement. Zain currently has a market valuation of $13.7 billion.


The largest shareholder in the company will remain the Kuwaiti government controlled Kuwait Investment Authority, which owns 24.6 per cent of the country’s largest mobile operator.


Zain has a commercial presence in eight countries across the Middle East with 45.2 million customers.


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