E&'s consumer and international units plan acquisitions in expansion drive

Top executives say deal-making can be funded through a 'variety of methods'

Khalifa Al Shamsi, chief executive of e& life, at the company's pavilion at Gitex Global in Dubai. Antonie Robertson / The National

The consumer and international units of UAE technology conglomerate e& plan to acquire complimentary assets to expand into new markets, as well as broaden their sector focus in an attempt to spur growth, their top executives have said.

E& life, which mainly focuses on the financial technology and video streaming services of the company formerly known as Etisalat Group, is considering options to expand into sectors including e-commerce, insurance and health, its chief executive Khalifa Al Shamsi told The National in an interview.

“We're definitely planning for more growth out of various types in the consumer digital space. When we look at any additional areas beyond FinTech and entertainment, let's talk about health technology, insurance technology and e-commerce,” Mr Al Shamsi said on the sidelines of the Gitex Global technology conference in Dubai.

The company is open to both outright purchases or partnerships to diversify its portfolio, which will enable it to expand locally and overseas, reaching a wider consumer base, he said.

The funding of mergers and acquisitions through debt is not being considered at this point, because e& as a group is financially strong and “M&As can be funded from the group [balance sheet] itself”, Mr Al Shamsi said.

Other options include attracting additional shareholders or strategic partners into the company.

“It's all about the timing of these activities. We will definitely do that whenever we see the value of a company and whether it will guarantee a good return to the group,” he said.

The company's flagship FinTech service, e& money, is wholly owned by e& life, “but there is an opportunity of having international partners along with us”, Mr Al Shamsi said.

The company's investment approach in preparing for any acquisition could differ, depending on the business line being considered, the market opportunity and the valuation of the target company at the time of the deal, he said.

Meanwhile, e& international, which oversees the group's operations abroad, constantly evaluates assets in countries that have a stable economy and currency regime. It looks at potential targets that will allow the company to generate enough return to reinvest in infrastructure and growth, its chief executive Mikhail Gerchuk told The National in a separate interview.

The company is currently focused on closing the deal to acquire a majority stake in PPF Group. This will give it a controlling stake in the Czech company's operations in Bulgaria, Hungary, Serbia and Slovakia, amid a push to expand into central and eastern European markets.

In Asia, e& international has no deals brewing at the moment but is looking to acquire talent from the continent to strengthen its position in the fixed and mobile categories, Mr Gerchuk said.

The company is open to buying both telecoms and digital companies that complement its portfolio, with funding for any transaction coming through a “variety of methods”, he said.

A potential initial public offering is not part of the either company’s growth plans at the moment, both executives said.

Most industries are going through a major transformation with the advent of new technology.

That has prompted businesses to adapt innovative technology to streamline and optimise their operations, allowing them to expand consumer base and add new revenue lines as competition intensifies.

Artificial intelligence, which has come to the fore thanks to the emergence of generative AI, is being positioned by e& life as the driver of its next generation of services.

The insight provided by AI will help e& life identify user behaviour based on various data metrics, which will help to streamline offerings for customers, Mr Al Shamsi said.

Across its services, the AI boost allows e& life to “design packages and pricing in order to attract and enhance the experience”, he said.

“Definitely, across the multiple platforms, we are putting additional use cases in order to enhance these services.”

E& money, which is being positioned as a “super app for FinTech”, is expanding its network with new partnerships, including one with Mastercard to boost services such as remittance, a key sector for a country such as the UAE with a significant number of foreign workers.

At e& international, Mr Gerchuk said, AI is helping its users in a number of ways, such as enhancing customers' search for information, providing access to services and allowing “much more efficient and comfortable dialogue” with the target market.

“AI will revolutionise our business, both for customers and how we operate. We want to become an AI-centric company,” he said.