Omantel to buy 12% of Kuwait's Zain - Gulf Business
Now Reading
Omantel to buy 12% of Kuwait’s Zain

Omantel to buy 12% of Kuwait’s Zain

Omantel purchased a 9.8 per cent stake in the company earlier this year

Oman Telecommunications (Omantel) plans to buy a 12 per cent stake in Kuwaiti telecoms company Zain in a deal that would more than double its stake as part of its expansion strategy.

Having purchased a 9.8 per cent stake in August to diversify its investment and market position in the region, Omantel said on Monday that it had signed a non-binding letter of intent with Kuwait-based Al Khair, an investment vehicle of Kuwait’s Al Kharafi merchant family, to purchase its 12 per cent holding.

A roughly 22 per cent stake in Zain could make Omantel its second-biggest shareholder behind the Kuwait Investment Authority sovereign wealth fund, which has more than 24 per cent.

“It would be interesting to watch how much (leverage) Omantel could have over Zain as they are buying the stake from the company’s most influential shareholder,” said SICO Research analyst Nishit Lakhotia.

“This could mean they get some level of management.”

Four members of the Al Kharafi family currently sit on the board of Zain, according to its website.

Zain’s share price lost 1.3 per cent on Monday, having jumped more than 5 per cent towards the end of last week on speculation about Omantel’s interest.

“We think the share price rallied on speculation that the acquisition will come at a substantial premium to market price, which we think is unlikely,” Arqaam Capital analysts said in a note.

Omantel shares were up 0.7 per cent.

Al Khair is studying and evaluating the offer, Omantel said in a statement without giving the price.


Scroll To Top