Rumor: ADIA and an Indian Co Buy a 46% Majority Stake in Zain (Update 2)

We usually don’t post rumors until a story is confirmed, but since the rumors on Zain have been the single largest driver of the whole market, this will be an exception.

At the beginning there was talk about a strategic partner buying the African operations, then rumors that a couple of investors are interested in buying a majority stake in the mother company, Indian Bharti then UAE Etisalat; but Etisalat recently denied their interest in the acquisition and we may have finally reached the end of the Zain saga.

Today, a strong rumor emerged that the Abu Dhabi Investment Authority (ADIA) and an Indian Co. are in agreement with majority shareholders (Kharafi-led consortium) to buy a 46% stake excluding treasury shares at a deal price of USD 13.8 billion which translates into KD 2.000 per share. Zain shares closed up 5.40% at KD1.580 today. Further, Kharafi’s National Investment Co. will manage the sale. Please note that Zain has treasury shares equal to 10%. Thus, a sale of 46% is indeed absolute majority based on a float of 90%.