Omantel has unveiled its largest overseas investment to date, with a US$846 million deal to acquire a nearly 10 per cent of the regional telco Zain.
The Muscat-based firm has announced a share purchase agreement to acquire 425.7 million shares in Zain, giving it a 9.84 per cent stake in the pan-regional operator.
The deal comes as Omantel looks to diversify its revenues ahead of increased competition in its home market, even as analysts question the high price agreed for a relatively minor stake.
“Acquiring a minority stake in Zain is a deliberate investment for Omantel as we position ourselves as a leading digital service provider,” said Omantel’s chief financial officer Martial Caratti.
“This is in line with our Corporate Strategy 3.0, launched in 2015. We have always emphasised that growth will come from continued diversification, and this acquisition positions Omantel for the future.”
_______________
Read more:
Abu Dhabi’s Etisalat bids for mobile licence in Oman
Kuwait's Zain posts flat earnings
_______________
The acquisition of the Zain stake would be one of Omantel’s first international forays. The Omani operator 10 years ago acquired Pakistani ISP Worldcall, but offloaded the investment this year.
Buying in to Zain will provide Omantel with much needed diversification away from its home market, ahead of increased domestic competition in the form of an upcoming third mobile operator, said Omar Maher, an analyst with EFG Hermes.
But Mr Maher questioned the price agreed by Omantel for Zain’s shares, equivalent to a 33 per cent premium on their current market price.
“We see this premium as unjustified given that no recent deal multiples have led to such high valuations, and bearing in mind that this is a significant minority stake that offers no control privileges to Omantel,” Mr Maher said in a research note issued yesterday.
Omantel will be hoping to leverage its new relationship with Zain to broaden its digital services offering, according to Matthew Reed, a Dubai-based analyst with Ovum.
“Zain already has a fairly wide-ranging digital strategy through its stake in smart-city developer nexGen and other digital initiatives, so one can see that there could be strategic benefits for Omantel in the tie-up.”
Telcos across the region are looking to such digital services to boost their profitability as margins flatten on core business lines such as voice and data.
Omantel said it would look to cooperate with Zain across core business functions including the wholesale telecom business, operations and networks, commercial activities, and knowledge and experience sharing.
Credit Suisse is acting as financial adviser to the deal on Omantel’s side, with Freshfields Bruckhaus Deringer providing legal advice.
Headquartered in Kuwait, Zain has a commercial footprint in eight countries across the Middle East and Africa, including Saudi Arabia, Bahrain, Iraq and Jordan.
The operator earlier this week reported flat quarterly profits for the second quarter, which nonetheless came in ahead of analyst forecasts.
“For Zain Group, we see the deal as very positive given that it unlocks considerable idle value on their balance sheet, which will likely be deployed into a mix of higher dividends to shareholders and reinvestment in the business, we expect,” said Mr Maher.
Zain submitted a bid this year for Oman’s third mobile licence, in competition with the UAE’s Etisalat and Saudi Telecom. A shortlist for the third licence is due to be announced on August 14 by Oman’s Telecommunications Regulatory Authority, with a winner selected early next month.
Representatives from Omantel and Zain declined to comment on whether Omantel’s investment in Zain would disqualify the latter from participating further in the licensing process.
TRA officials did not respond to a request for comment.
if you go
The flights
Fly direct to Kutaisi with Flydubai from Dh925 return, including taxes. The flight takes 3.5 hours. From there, Svaneti is a four-hour drive. The driving time from Tbilisi is eight hours.
The trip
The cost of the Svaneti trip is US$2,000 (Dh7,345) for 10 days, including food, guiding, accommodation and transfers from and to Tbilisi or Kutaisi. This summer the TCT is also offering a 5-day hike in Armenia for $1,200 (Dh4,407) per person. For further information, visit www.transcaucasiantrail.org/en/hike/
25%20Days%20to%20Aden
%3Cp%3EAuthor%3A%20Michael%20Knights%3C%2Fp%3E%0A%3Cp%3EPages%3A%20256%3C%2Fp%3E%0A%3Cp%3EAvailable%3A%20January%2026%3C%2Fp%3E%0A
The specs
Engine: 3-litre twin-turbo V6
Power: 400hp
Torque: 475Nm
Transmission: 9-speed automatic
Price: From Dh215,900
On sale: Now
Warlight,
Michael Ondaatje, Knopf
The Byblos iftar in numbers
29 or 30 days – the number of iftar services held during the holy month
50 staff members required to prepare an iftar
200 to 350 the number of people served iftar nightly
160 litres of the traditional Ramadan drink, jalab, is served in total
500 litres of soup is served during the holy month
200 kilograms of meat is used for various dishes
350 kilograms of onion is used in dishes
5 minutes – the average time that staff have to eat
THE LIGHT
Director: Tom Tykwer
Starring: Tala Al Deen, Nicolette Krebitz, Lars Eidinger
Rating: 3/5
MATCH INFO
Borussia Dortmund 0
Bayern Munich 1 (Kimmich 43')
Man of the match: Joshua Kimmich (Bayern Munich)
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
2024%20Dubai%20Marathon%20Results
%3Cp%3E%3Cstrong%3EWomen%E2%80%99s%20race%3A%3C%2Fstrong%3E%0D%3Cbr%3E1.%20Tigist%20Ketema%20(ETH)%202hrs%2016min%207sec%0D%3Cbr%3E2.%20Ruti%20Aga%20(ETH)%202%3A18%3A09%0D%3Cbr%3E3.%20Dera%20Dida%20(ETH)%202%3A19%3A29%0D%3Cbr%3EMen's%20race%3A%0D%3Cbr%3E1.%20Addisu%20Gobena%20(ETH)%202%3A05%3A01%0D%3Cbr%3E2.%20Lemi%20Dumicha%20(ETH)%202%3A05%3A20%0D%3Cbr%3E3.%20DejeneMegersa%20(ETH)%202%3A05%3A42%3C%2Fp%3E%0A
Company%20profile
%3Cp%3E%3Cstrong%3ECompany%20name%3A%20%3C%2Fstrong%3EXare%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarted%3A%20%3C%2Fstrong%3EJanuary%2018%2C%202021%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EFounders%3A%20%3C%2Fstrong%3EPadmini%20Gupta%2C%20Milind%20Singh%2C%20Mandeep%20Singh%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EBased%3A%20%3C%2Fstrong%3EDubai%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ESector%3A%20%3C%2Fstrong%3EFinTech%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EFunds%20Raised%3A%20%3C%2Fstrong%3E%2410%20million%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ECurrent%20number%20of%20staff%3A%20%3C%2Fstrong%3E28%C2%A0%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EInvestment%20stage%3A%20%3C%2Fstrong%3Eundisclosed%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EInvestors%3A%20%3C%2Fstrong%3EMS%26amp%3BAD%20Ventures%2C%20Middle%20East%20Venture%20Partners%2C%20Astra%20Amco%2C%20the%20Dubai%20International%20Financial%20Centre%2C%20Fintech%20Fund%2C%20500%20Startups%2C%20Khwarizmi%20Ventures%2C%20and%20Phoenician%20Funds%3C%2Fp%3E%0A
Killing of Qassem Suleimani
Company%20Profile
%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%20myZoi%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202021%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Syed%20Ali%2C%20Christian%20Buchholz%2C%20Shanawaz%20Rouf%2C%20Arsalan%20Siddiqui%2C%20Nabid%20Hassan%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20UAE%3Cbr%3E%3Cstrong%3ENumber%20of%20staff%3A%3C%2Fstrong%3E%2037%3Cbr%3E%3Cstrong%3EInvestment%3A%3C%2Fstrong%3E%20Initial%20undisclosed%20funding%20from%20SC%20Ventures%3B%20second%20round%20of%20funding%20totalling%20%2414%20million%20from%20a%20consortium%20of%20SBI%2C%20a%20Japanese%20VC%20firm%2C%20and%20SC%20Venture%3C%2Fp%3E%0A
Profile box
Company name: baraka
Started: July 2020
Founders: Feras Jalbout and Kunal Taneja
Based: Dubai and Bahrain
Sector: FinTech
Initial investment: $150,000
Current staff: 12
Stage: Pre-seed capital raising of $1 million
Investors: Class 5 Global, FJ Labs, IMO Ventures, The Community Fund, VentureSouq, Fox Ventures, Dr Abdulla Elyas (private investment)
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia